Licensing Bill [Lords]

Public Bill Committee, 29 April 2003.

Standing Committee D

Clause 47 - Interim authority notice following death etc. of licence holder

Malcolm Moss (Conservative, North East Cambridgeshire)

I beg to move amendment No. 276, in

clause 47, page 27, line 19, leave out 'seven' and insert 'ten'.

Roger Gale (Conservative, North Thanet)

With this it will be convenient to discuss the following:

Amendment No. 277, in

clause 47, page 27, line 42, leave out 'seven' and insert 'ten'.

Amendment No. 278, in

clause 47, page 28, line 17, leave out 'seven' and insert 'ten'.

Amendment No. 279, in

clause 47, page 28, line 18, leave out 'seven' and insert 'ten'.

Amendment No. 280, in

clause 47, page 28, line 23, leave out 'two' and insert 'three'.

Amendment No. 281, in

clause 48, page 28, line 37, leave out 'seven' and insert 'ten'.

Amendment No. 282, in

clause 48, page 28, line 43, leave out '48' and insert '96'.

Amendment No. 283, in

clause 48, page 29, line 1, after 'it', insert 'within 14 days'.

Amendment No. 285, in

clause 50, page 30, line 6, leave out 'seven' and insert 'ten'.

There is only one group of amendments to the clause. It is entirely up to the judgment of members of the Committee, but I am prepared to allow a fairly wide-ranging debate to take place along the usual terms. If that happens, there will be no stand part debate. I leave that for hon. Members to determine for themselves.

Malcolm Moss (Conservative, North East Cambridgeshire)

Thank you, Mr. Gale. Welcome back to the Chair after what, I hope, was a pleasant Easter break. The amendments are probing amendments. They deal with various time scales to test the Government's thinking behind the length of the periods set out in the Bill. They relate to clause 47, which deals with the interim authority notice following the death et cetera of a licence holder as defined by ''death, incapacity''—I suppose that that is mental incapacity—

''or insolvency of the holder''

under subsection (1)(a).

Such events are fairly traumatic and, one way or another, would throw the business into panic. The Bill allows seven days after such an event for the notice to be submitted. We argue that that period is probably on the tight side, in light of the circumstances that gave

rise to such events. A10-day period would give an extra three days, with perhaps a weekend in between, to allow people to collect their thoughts and take stock of the situation, for example, when a person has died or been admitted to hospital. It would give people time to adjust to such matters and to make the necessary arrangements as well as thinking about the serving of an interim notice. We want to elicit from the Government their reasons for wanting a period of seven days after a fairly traumatic event has happened.

Amendment No. 282 would increase the time between the chief officer of police receiving a copy of the interim authority notice and notifying the relevant licensing authority that he or she was duly satisfied. It would change the time from 48 hours to 96. We want to test why 48 hours is deemed to be appropriate. At present, our police force says that it is overworked and under great pressure. As we know, our constabularies suffer problems of one sort or another and to state, under the Bill, that they should react within 48 hours of receiving a notice seems a little on the tight side.

Let us consider the Easter break, when there was a holiday period of four days: Good Friday, the weekend and Easter Monday. Obviously, police officers do not down tools for the whole Easter period, but there would probably be fewer of them on duty and to say that they had to respond within 48 hours in such a holiday period would put undue and unreasonable pressure on them. Have the Government taken such matters into account?

Amendment No. 283 would impose a time limit of 14 days for a hearing to take place by a local authority under clause 48(3)(a), which states that the authority must hold a hearing to consider the notice

''unless the authority, the relevant person and the chief officer of police agree that a hearing is unnecessary''.

Time scales are imposed on everyone else, such as the person who must submit the interim authority notice and the police, but nothing in the Bill requires the local authority to respond within a particular time. Perhaps the Minister will enlighten me otherwise. Everyone else seems to be held to a time limit and the local authority should be, too.

The situation could be fairly tricky. The business may be in a period of hiatus and there may be questions about how it should continue, who would take over, and so forth. It seems unreasonable that the Bill provides no time limit within which the local authority should respond and hear the police objection. Perhaps the Minister will consider whether, in the interests of a speedy transition, it is necessary to impose a time limit within which a local authority should hold a hearing.

If the police object to an interim notice, a cloud of suspicion may hang over the head of the individual who wishes to take over and it is important that that be removed quickly and reasonably, for the success of the business.

Kim Howells (Labour, Pontypridd)

I thank the hon. Member for North-East Cambridgeshire (Mr. Moss) for the spirit in which he moved the amendment. He was correct to frame it as he did. Such incidents are often traumatic for the family of the persons concerned and for

employees of the establishments. The system set out in the Bill is designed to benefit principally those sections of the industry that lease property to tenants, although the range of circumstances in which such arrangements might apply goes wider than that.

If a premises licence has lapsed due to the events set out in clause 47—the death, incapacity or insolvency of the licence holder—it may be reinstated so that its authorisation may be transferred to another individual, organisation, or an interim authority obtained, provided that the application is made within seven days of the lapse of the licence. That is a major improvement on the current system, whereby a full hearing before the licensing justices would be required for an interim authority. The time limit is sensible and has been set to minimise the impact of the unfortunate events on those who work at the premises. When the licence lapses, those employed at the premises will effectively be out of a job until the licence is reinstated by the means provided for in the clause.

The seven-day limit was chosen to strike a balance between allowing sufficient time for a bereaved relative, for example, to make an application and the interests of those who earn a living at the premises. Nevertheless, I understand fully what the hon. Gentleman said about the possible state of mind of the relatives at such a time. It is essential that the period of time is kept to a minimum, because the authorisation would essentially have gone with the unfortunate events leading to the lapse of the licence and any steps to put life back into the authorisation should be taken without delay. If there is a longer delay before the premises could again do business, much hardship may be caused to employees who, through no fault of their own, could find themselves unable to earn an income. There is likely to be some uncertainty for employees, even with a period of seven days. There would, however, be less uncertainty under the clause as it stands than with the extended limit proposed in the amendment.

I am sure that hon. Members would not wish to impose such privations on employees, some of whom may be at the lower end of the income spectrum of the licensed trade.

Malcolm Moss (Conservative, North East Cambridgeshire)

For clarification, is the Minister saying that as soon as a licence holder dies, for example, the business at the premises involved cannot carry on until the interim notice is filed and accepted? Does the business effectively close down on the death of the licence holder?

Kim Howells (Labour, Pontypridd)

Yes, essentially that is what happens. Once the event has occurred, the permission is gone. That is why we have to act with a little more haste than that which might be allowed by the amendments.

Amendment No. 280 would extend the interim authority period—that is, the period after which the licence again lapses—from two months to three months. I understand why the hon. Gentleman thinks that such an extension might benefit the industry. I remind him that clause 47 also provides

that if a relevant transfer application is made before the end of the interim authority period—that sometimes happens when people are very ill or if it is thought that something traumatic will occur—the transfer of the licence to the applicant will have immediate interim effect, pending the determination of that application. The provisions in the Bill that relate to the reinstatement of licences are designed to allow businesses to react to unfortunate circumstances and to keep businesses in being pending the taking of long-term commercial decisions.

Two months is plenty of time for such an application to be made and I do not think that there is any need to extend the interim authority period. Two months is, of course, considerably longer than the 28 days given under current legislation for interim authority notices to be granted.

Malcolm Moss (Conservative, North East Cambridgeshire)

Is the Minister telling us that he, or his Department, has received representations from the industry to say that the 28 days allowed under law is insufficient? Did industry ask for that period to be doubled, or did it ask for three months?

Kim Howells (Labour, Pontypridd)

As I understand it—we have had extensive consultation with the industry on the matter—we have had no objections to the period of a month. Perhaps the hon. Gentleman has been speaking to other parts of the industry and those discussions are what lie behind his amendments. I accept that, but I can only give him that answer.

Amendment No. 283 would require that, if the chief officer of police told the licensing authority that he was satisfied that the interim authority notice should be cancelled, to prevent the crime prevention objective from being undermined, the licensing authority would be required to hold a hearing within 14 days. That is unless the authority, the relevant person, and the police agree that a hearing is unnecessary. I presume that the amendment was tabled because hon. Members are concerned that a hearing could be put off indefinitely—indeed, I think that that is the point that the hon. Gentleman was making—and that the police notice would therefore be ineffective. I agree entirely that that would be an unacceptable state of affairs and I assure hon. Members that the Secretary of State will use her powers under clause 180 to make regulations relating to the procedures for hearings, and that we will put a limit on the time that can be taken for hearings on interim authority notices following police objections.

With those undertakings, I hope that hon. Members are reassured and feel able to withdraw the amendment and that they will not press the other probing amendments grouped with it.

Mark Field (Conservative, Cities of London and Westminster)

I have consulted with my esteemed colleague, my hon. Friend the Member for Isle of Wight (Mr. Turner), and wonder what would happen in an insolvency situation. Will the Minister say a few words about how the system would operate if a company were going bust, or if a person was involved in a receivership or went bankrupt? Clearly, in a corporate liquidation, an administrator might be appointed, and one of their most important duties

would be to maintain the business as a going concern. Although we appreciate that there is a distinction between a business and a licence that is in personal hands there are complications, particularly in relation to strict time limits. Has the Minister anything to say on how this would operate in practical terms?

Kim Howells (Labour, Pontypridd)

There are strict regulations that deal with the insolvency of any commercial company. In this case, there are ramifications that may not exist for other companies: some of them are included in the principal objectives of the Bill and, because they involve alcohol and the possibility of a house being an unruly place or public disorder taking place as a direct consequence of the sale of alcohol, these procedures would come into play specifically in relation to licensed premises. This deals with licensed premises rather than generally with insolvency law.

Andrew Turner (Conservative, Isle of Wight)

I was interested to hear the Minister's reply to my hon. Friend the Member for Cities of London and Westminster (Mr. Field) on that matter. We are talking once again at the extreme end of things if we talk only about premises on which alcohol is sold. These licences cover a whole range of events, including morris dancing in pub car parks—or, indeed, in school car parks, when no alcohol is for sale. I am concerned about whether the lapse of a licence on the insolvency of an individual licence holder would render it impossible, until the interim authority is given, for the activity to continue, even if it were at the lowest end of the scale: I think that that was the purpose of my hon. Friend's intervention.

There is another question, which relates to death. I appreciate that that cannot necessarily be planned. [Interruption.] It may be planned in the constituency of the hon. Member for North Durham (Mr. Jones), but it is not usually planned in mine. People make a range of arrangements in the event of death, or mental incapacity, including the use of the enduring powers of attorney that are mentioned in clause 27(1). Has the Minister explored alternative arrangements to this complex one of an interim authority having to be procured during which period the business cannot operate? In almost any other area of business one would expect the business to continue to operate. Is the business which is licensed in every case of such extreme danger to the public that it is necessary for it to cease to function?

The Minister pointed out that people actually lose their jobs on the death of a licensee. I would have thought that that was something that we would wish to protect them against altogether, rather than merely for as short a period as possible. I appreciate why the Minister is unhappy with the amendments to extend the period from seven to 10 days, but I would have thought that we could find a way to protect altogether the jobs of those who work for, for example, a publican, or of those who put on dances or events of a similar nature. Has the Minister explored alternatives? If so, what are the conclusions of those explorations—what are the alternatives and why has he rejected them?

Kim Howells (Labour, Pontypridd)

As far as I am aware, I have not rejected anything at the moment. I intended to answer

a question that was raised by the hon. Member for North-East Cambridgeshire. It was a specific question and I did not know the answer at the time, but I know it now. The Interpretation Act 1978 will apply to the Bill and deals with calculations of time periods which would allow for public holidays. Regulations will also deal with time limits for the licensing authority's response. I was indeed a little perplexed about what would have happened if, on the Friday before the Easter weekend, a traumatic event had occurred.

The hon. Member for Isle of Wight asked me about insolvency. It is true that insolvency would lead to the lapse of a premises licence. There is no hierarchy of activity; activity is either licensable or not, and that is a problem. However, an administrator can apply for an interim authority notice. The hon. Gentleman has got to the nub of problem, as the speed of the process is important.

Malcolm Moss (Conservative, North East Cambridgeshire)

On the question about insolvency from my hon. Friend the Member for Isle of Wight, it is obviously in the interests of a business, or the person who wishes to take over a business, to get the interim notice through as quickly as possible to avoid delay. The pressure is therefore on the individual. Why, then, is there a limit of seven days? Why would the state or the Government want to set a time limit on the speed of operations? It is not in the interests of the state whether the business is up and running in one day or 10 days, so why, in reversing my earlier argument, has a limit of seven days been imposed at all?

Kim Howells (Labour, Pontypridd)

I have tried to explain that we want to limit as far as possible the period of uncertainty in an industry that employs a large number of people in this country. The hon. Gentleman might think that seven days is an arbitrary figure, and that it could be 10 or 14 days. I have tried to argue—the hon. Member for Isle of Wight argued the same—that from the views that we have heard from the industry, seven days creates a sensible balance. Given the other guarantees that I have tried to make clear to hon. Members, that period is for the business in question to seek an interim authority and reassemble itself.

Malcolm Moss (Conservative, North East Cambridgeshire)

So, if that business fails within the seven-day period to submit an application for the interim notice, what happens? How does the business go about resurrecting itself after those seven days?

Kim Howells (Labour, Pontypridd)

The business would have to apply for a new licence and follow procedures. The interim authority arrangement gives that business the opportunity of some continuity, and it does not involve a long application—at least, we assume that it would not. I want to answer the question about what would happen if there were a death, which was put by the hon. Member for Isle of Wight—I am intrigued by the possibility that deaths can be arranged in the Isle of Wight.

Andrew Turner (Conservative, Isle of Wight)

Perhaps in North Durham.

Kim Howells (Labour, Pontypridd)

Or in North Durham.

The authority of the licence is personal to the holder, so if the holder dies, or becomes incapable through mental incapacity or insolvency, no authority

exists to carry on business activities. However, interim authorities have immediate effect, which is the point that I have been trying to make to the hon. Member for North-East Cambridgeshire. The fact that they have immediate effect is beneficial; it will be good for the business and the employers.

Andrew Turner (Conservative, Isle of Wight)

Can the Minister tell me whether an interim authority can be applied for, or at least prepared for, in advance of death?

Kim Howells (Labour, Pontypridd)

Not as far as I know. I think that the traumatic event must first take place. However, as with any other area of business, if things appear to be drifting, an astute manager or associates will make the types of preparation at which the hon. Gentleman is hinting.

Mark Hoban (Conservative, Fareham)

I want to ask about the process relating to insolvency. When a business goes into receivership, there is often a period during which the administrator tries to sell it. Would the administrator be required at any time to have a personal licence to continue the trade of the pub, night club or whatever, until the point at which he sells the business to another purchaser?

Kim Howells (Labour, Pontypridd)

As I said, the administrator can apply for an interim authority notice, which gives him the right to continue the business. As the hon. Gentleman says, the licence essentially gives the administrator the opportunity to say, ''Look, here we have a going concern and it should continue.'' That sometimes happens. Recently, I was talking to members of the industry about such situations and they were most concerned that there should be the minimum of interruption to the business's operations. That is why we are sticking with seven days, rather than changing the figure to 10 or anything else. Seven is the right balance.

I should like to nuance something that I said to the hon. Member for Isle of Wight earlier: if there is mental incapacity, there is nothing to prevent the licence from being transferred, whether that had been arranged or not, even though the person has not died.

Malcolm Moss (Conservative, North East Cambridgeshire)

I am grateful to the Minister for his detailed explanations and I am generally satisfied by the arguments that he has put for the Government's case for the Bill. However, there is one exception, which relates to the local authority responding within a time scale by holding a hearing of objections that have been raised by the chief officer of police. The Minister sought to assure us that that would be dealt with by the Secretary of State under clause 180 and by regulations pertaining to the giving of hearings. However, clause 180 does not refer to a time scale, so we are left with a promise from the Minister that the situation will be dealt with at some unknown time.

Kim Howells (Labour, Pontypridd)

The hon. Gentleman is right. I have always been sceptical about not tackling such issues in the Bill. However, I give him the reassurance that we need that flexibility in this case because if regulations that are introduced are seen not to work, we ought to be able to change them quickly so that they respond to

the needs of industry and employees and the licence holder if it is a small business.

Malcolm Moss (Conservative, North East Cambridgeshire)

Will the Minister give us a steer as to his thinking? Does he think that a time scale of 14 days is appropriate or acceptable? I understand that he wants to build in flexibility, but there should be some definitive time scale within which the hearing takes place. Will he share with us any thoughts that he has had up to now about the appropriate time scale?

Kim Howells (Labour, Pontypridd)

As the hon. Gentleman knows, I am not good at sharing confidential information with the Committee, but I can tell him that he is in the right area. We have to think about the job that the local authority and the applicant will have in marshalling their cases.

Malcolm Moss (Conservative, North East Cambridgeshire)

Given that we will not reach clause 180 until our last or last but one sitting on 20 May, there is a lot of time between now and then for the Minister to hold any necessary meetings. At least when we reach that clause, he will then be able to give us the assurance that he has honed his thinking. We are not asking the Minister for trade secrets, we are simply asking him to put some flesh on the bones of the promise he made to the Committee. I am happy to withdraw the amendments, but when we get to clause 180 we will focus on the assurances that the Minister has given us. We hope that some serious thinking happens before then, so we know where we stand before the Bill leaves Committee.

I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Amendments made: No. 46, in

clause 47, page 27, line 31, at end insert 'or'.

No. 47, in

clause 47, page 27, line 33, leave out 'or'.

No. 14, in

clause 47, page 27, line 34, leave out paragraph (d).—[Dr. Howells.]

Clause 47, as amended, ordered to stand part of the Bill.

Clause 48 ordered to stand part of the Bill.

Clause 49 - Supplementary provision about interim authority notices

Malcolm Moss (Conservative, North East Cambridgeshire)

I beg to move amendment No. 284, in

clause 49, page 29, line 31, leave out subsections (5) and (6).

Roger Gale (Conservative, North Thanet)

With this it will be convenient to discuss the following:

Amendment No. 290, in

clause 56, page 33, line 29, leave out subsections (3) and (4).

Malcolm Moss (Conservative, North East Cambridgeshire)

These probing amendments deal with the failure to comply with certain sections and subsections and with the appropriate level of fines that could be levied. I want to ascertain why the Government think it is such a serious, heinous offence not to comply with the provision of the interim authority notice. If an individual does not comply, they may under subsection (6) be subject to a penalty fine not exceeding level 3—a sum of £1,000. That is a heavy-

handed, draconian penalty for what may be an error or oversight.

We are dealing with interim authority notices that would be issued when people may be focused on other things. Traumatic times may follow after someone has died or gone into hospital, or if a business has gone into receivership, during which it may be fairly easy to overlook certain matters. Nevertheless, the Government are saying that if someone is a naughty boy and does not comply they could be fined up to £1,000. That is somewhat over the top and rather draconian.

Amendment No. 290 refers to clause 56 and a fine of level 2—some £500—which is also a little too heavy. We wish to ascertain why the Government believe that certain omissions, such as failing to submit notices or provide information, are so terrible that fines of that order must be implemented.

Kim Howells (Labour, Pontypridd)

Clause 49 makes supplementary provision on interim authority notices; subsection (4) provides that a person becoming a holder of a premises licence by virtue of an interim authority notice

''must (unless he is the designated premises supervisor) forthwith notify the supervisor . . . of the interim authority notice.''

Subsection (5) provides that it is an offence,

''without reasonable excuse, to comply with subsection (4)''—

I emphasise that for the hon. Gentleman. Subsection (6) provides that

''A person guilty of an offence under subsection (5) is liable on summary conviction to a fine not exceeding level 3 on the standard scale'',

which the hon. Gentleman mentioned.

Amendment No. 284 would remove the offence of failing to notify the designated premises supervisor of an interim authority notice. It is anticipated that that person would, in practice, be responsible on a day-to-day basis for what goes on at a premises on behalf of the holder of the premises licence, especially for the sale of alcohol. If the licence in question has lapsed, the authority for carrying on with the sale of alcohol or any other licensable activity on the premises no longer exists. Those licensable activities may not be carried on again until an appropriate authority—in this case, an interim authority notice—is in place. Such a notice will, for want of a better word, revive the licence in the same form that it took immediately before its lapse. It will specify the designated premises supervisor, and will allow the continuation of the licensable activities.

It is vital that the supervisor is made aware of that fact, particularly as he needs to know the identity of the licence holder, just as he does when a licence has been transferred, as well as the fact that he or she is susceptible to committing certain offences on licensed premises. Of course, there is a strong vested interest in the removal of a potential offence, but such a removal would simply undermine the importance that the Bill attaches to the specification of the designated premises supervisor, the need for transparency and the certainty attaching to those involved in the licensing regime.

The amendment would remove a requirement on businesses that has been put in place not only because that requirement is important, as I have said, but out of regard for fairness. The Bill ensures that a designated premises supervisor will know who is responsible for the premises licence, and there can be no good reason why there should not be a similar requirement on the business. The premises supervisor will have certain duties and obligations by virtue of his or her position in an organisation. In order to carry out those responsibilities properly, he or she will need to be familiar with the details of the premises licence, and the name of the person or company holding that licence, or given an interim authority notice, is an important detail. It is therefore only right that he or she be told when the person holding the premises licence—or in this case an interim authority notice—has changed. Because that is important, we need to ensure that the requirement can be enforced with appropriate penalties.

Clause 56 provides that if a licensing authority makes a determination or receives a notice in relation to a premises licence, or if the licence lapses or an appeal against a decision made under part 3 is determined, the authority must make any appropriate amendments to the licence and, if necessary, issue a new summary. Subsection (2) provides that if the authority is not in possession of a licence or the appropriate part of it, it may require the holder of the licence to produce it or the appropriate part of it within 14 days. Subsection (3) provides that a person commits and offence if he fails to comply with such a request, and subsection (4) says that a person guilty of that offence is liable to a fine not exceeding level 2 on the standard scale.

Amendment No. 290 would remove the offence of failing to produce the licence, or the appropriate part of it, for the authority within 14 days to allow it to be updated. It is important to all of those involved in the licensing system, including the police, the licensee, and the licensing authority, that premises licences be kept up to date, so that any information obtained from them is accurate. It therefore seems entirely reasonable that the licensing authority should be able to request licences, or parts of them, when they need to be updated, and that it should be an offence not to comply with such a request.

Malcolm Moss (Conservative, North East Cambridgeshire)

The Minister has moved on to clause 56 and amendment No. 290 to it. Subsection (2) of that clause says that

''Where a licensing authority is not in possession of the licence (or the appropriate part of the licence)'',

the person who has taken over the interim authority notice must, under penalty, provide the licence. However, the local authority will not have to pay a penalty for not having a copy of the licence. I can understand that the person taking over might not have the original licence, but surely the local authority will have a copy of the licence in its records. It could therefore see what was written on the licence, and the licence could be amended accordingly.

I fail to understand why there is a penalty if someone who has just taken over in special circumstances does not comply with that provision

of the licence. He may not know where to find it. The local authority should have a copy, yet the Bill does not say that the local authority is responsible.

Kim Howells (Labour, Pontypridd)

That is a good point, and I assure the Committee that for the vast majority of premises, such requests are not likely to be frequent. As the hon. Gentleman says, in many instances the licensing authority will already have the licence, or the appropriate part of it, when an update needs to be made. For instance, an application for the variation of the designated premises supervisor must be accompanied by the licence or the appropriate part of it, and no additional request will be needed. When those requests are made, the Bill allows 14 days for compliance before any offence is committed. That seems reasonable to me, so I ask the hon. Gentleman to withdraw the amendment.

Andrew Turner (Conservative, Isle of Wight)

Again, having listened to the Minister, I am more puzzled than I was before he started. That might be my fault, rather than his.

I shall illustrate some of the circumstances that may arise on the death of the holder of a premises licence, and I want the Minister to tell me whether he thinks that it is just that the person who serves the notice should be prosecutable under subsection (5). [Interruption.] I did not hear what the Minister said.

Kim Howells (Labour, Pontypridd)

I am not sure what the hon. Gentleman means by ''the person who serves the notice''.

Andrew Turner (Conservative, Isle of Wight)

I mean the holder—the person who is seeking to obtain the interim authority.

Someone who lived in Shanklin might have a distant uncle in North Durham who ran a pub. If that uncle had no closer relatives and he were to die, the person who lived in Shanklin might apply for the interim authority for the pub, as they wished to ensure that the business continued; they might inherit it, so it might be in their interests to ensure that it was maintained in good condition, and they might be concerned about some of the staff of the pub, whom they might have met 15 years before when they last visited North Durham—not a journey that one frequently makes from the Isle of Wight.

Mark Hoban (Conservative, Fareham)

It could be in Fareham.

Andrew Turner (Conservative, Isle of Wight)

It might indeed be in Fareham; that is not a journey that one frequently makes from the Isle of Wight, either.

The person from Shanklin would apply for the interim authority, and would then face the puzzle of finding out who held the personal licence. There might be no documentation; the business might have been conducted in less than perfect civil service style—as many businesses are. Therefore, it might be difficult for them to discover who held the personal licence that authorised the business to continue. If they knew sufficient about the law, they might wish to install a personal licensee of their own, but they would not be the owner of the premises at this stage because the estate had not been sorted out.

That person might not even know whether the holder of the personal licence in respect of those premises had applied for an interim authority, because clause 47(2) merely states that someone who

''has a prescribed interest in the premises''

may serve the interim authority notice. Therefore, it is possible that two people with conflicting interests could serve that notice—except that clause 47(4) states:

''Only one interim authority notice may be given''.

Who or what is to say who should give that notice? Is it regulations, or the law of inheritance, or the Secretary of State, or the person who gets the notice in first? I am becoming increasingly puzzled as to how—in practical rather than theoretical terms—it can be just that the person who has served the interim notice should be liable to prosecution.

I also wish the Minister to address the use of the words ''without reasonable excuse'' because it is my understanding that ignorance of the law is not a reasonable excuse for failing to comply with it, yet a pub may well be inherited by someone who has no experience of conducting a licensed trade. Can the Minister clarify what would happen if two people attempted to serve the interim notice? Who is going to prescribe the ''prescribed interest''? I see nothing in clauses 54 or 55 that is meant to restrict the power of the Secretary of State—or anyone else—to do the prescribing under clause 47(2).

Kim Howells (Labour, Pontypridd)

I am intrigued by the hon. Gentleman's scenario, in which the Secretary of State is the person who applies for an interim authority notice for the Dog and Duck. Such situations are flights of fancy. They do not occur. A company running a chain of about 7,000 premises told us that it expected to use interim authority notices about four times a year. The requirements are therefore not likely to be onerous. Notices are not required frequently, but when they are required they can cause difficulties, as the hon. Member for North-East Cambridgeshire pointed out, especially for small businesses. That is why we are trying to make the requirement clear.

As the hon. Member for Isle of Wight knows, because he has gone through the Bill with a fine-toothed comb, the licence must be kept by the licence holder at the premises for other purposes—for enforcement. Enforcement officers need to know what licensable activities are authorised by the licence, and whether any conditions are attached to them. A copy of the licence must be made available at the licensed premises. This is not rocket science. Level 3, at which the fine is set, means up to £1,000, and on conviction it will be for the courts to decide, on the individual merits of each case, the appropriate level of fine. Clause 190 sets out a definition of ''prescribed''; it means ''prescribed by regulations'', which is clear enough.

As for two people applying for an interim authority notice, only one such notice may be issued, and I hope that it helps the hon. Member for North-East Cambridgeshire to learn that it will be issued to the first applicant. On that note, I hope that the hon. Gentleman will withdraw his amendment.

Andrew Turner (Conservative, Isle of Wight)

The Minister says that the interim authority notice will be issued to the first person who applies for it, but clause 47(4) states:

''Only one interim authority notice may be given'',

and says that notice is given by the person who has the prescribed interest. If there are two people with a prescribed interest, they may both give the notice despite the content of subsection (4)—or am I missing something?

Kim Howells (Labour, Pontypridd)

Yes; I have tried to make it clear that the hon. Gentleman is missing the point. The licensing authority will issue only one interim authority notice, which will be issued to the first applicant—if it considers them a proper person to receive it.

Malcolm Moss (Conservative, North East Cambridgeshire)

I have listened carefully to what the Minister has had to say, and he has made a reasonable fist of explaining the words in the Bill. I am still puzzled however, particularly by clause 49, including subsections (5) and (6), to which amendment No. 284 refers. Clause 49(4) states:

''Where a person becomes the holder of a premises licence by virtue of section 47, he must (unless he is the designated premises supervisor under the licence) forthwith notify the supervisor (if any) of the interim authority notice.''

Here we have someone who has applied for the notice and has been successful in obtaining it. Under clause 47(2)(a) or (b) however, that person either

''has a prescribed interest in the premises concerned, or . . . is connected to the person who held the premises licence''.

Here we have a business, and somebody dies. That business would have had a designated premises licence supervisor. That may have been the person who died, but it is more likely to have been someone else. In the case of a business that collapses following the death or whatever of the licence holder, there would be a requirement to apply for an interim notice. A time scale would be given, so the onus would be to move such matters forward quickly. At that stage, the successful applicant for the interim notice would be known by the designated premises supervisor. After all, that person was in the business and had been running it alongside the premises licence holder for some time. Why does the Bill propose that the person who takes over the interim notice should be fined £1,000 for not telling the DPS? I should have thought that they would be known to each other.

Kim Howells (Labour, Pontypridd)

With great respect to the hon. Gentleman, I have just quoted an example of a pub chain with 7,000 premises, which would use interim authority notices only about four times a year. I know that we live in a democracy—indeed, a meritocracy in some cases—but someone working in a pub would not necessarily know someone as famous as Mr. Ted Tuppen. Such a person may not even know the board of directors that would be applying for the interim notice, so it is important that he be kept in the picture about what is happening with the premises. Otherwise, that person could be found guilty of selling alcohol when he has no right to do so. Surely that is an important way of preventing people from committing crimes.

Malcolm Moss (Conservative, North East Cambridgeshire)

I am grateful to the Minister for his answer, but surely the designated premises supervisor falls when the premises licence changes. If the premises licence holder has died—a situation that is covered by clause 47—and someone else applies for the interim notice, a designated premises supervisor has to be reappointed.

Kim Howells (Labour, Pontypridd)

No.

Malcolm Moss (Conservative, North East Cambridgeshire)

A designated premises supervisor will have to be reappointed. Earlier we covered the fact that there must be a DPS, and the Bill proposes a heavy fine in that respect. It is self-evident that people will be known to each other. If a big chain is involved, it is obvious that the chain itself will apply for a notice and the transition will be almost seamless. I fail to see why a heavy fine is proposed.

Andrew Turner (Conservative, Isle of Wight)

I am intrigued by my hon. Friend's argument. I am not clear whether a premises licence has to be held by an individual or a body corporate. If it were held by a body corporate, although such a body could die through insolvency, it is not likely to die by any other means, so it is unlikely that the body corporate would need to serve an interim authority notice—[Interruption.] I am sorry, I should say to ''give'' an interim authority notice; I should use the same term as is used in clause 47. When does the example of a body corporate fit in? Perhaps my hon. Friend can help me.

Malcolm Moss (Conservative, North East Cambridgeshire)

It is feasible that the body corporate that owns the business and premises will ensure that the premises licence is held by the individual who runs the business. That is not a problem. When discussing clause 47, we debated what happens when a person who holds such a licence dies, enters a mental institution or becomes insolvent. That triggers off the requirement that either the interim notice be applied for, or the business must collapse, and at some stage in the future someone will reapply for the licence and start afresh. Given such circumstances, it is almost impossible that a person working in the pub would not know who had taken over under an interim notice. If the designated premises supervisor fell, in legal terms, when the licence holder died, a new supervisor would have to be reappointed by the new holder of the licence under the interim authority. It seems unreasonable to charge someone £1,000 for failure to tell the person what has happened. However, we have had a long debate on the matter now. I may return to it on Report, but for the moment, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 49 ordered to stand part of the Bill.

Clause 50 ordered to stand part of the Bill.

Clause 51 - Application for a review of premises licence

Malcolm Moss (Conservative, North East Cambridgeshire)

I beg to move amendment No. 225, in

clause 51, page 30, line 21, at end insert—

'(1A) Without prejudice to subsection (1), the chief officer of police for the police area in which any premises are situated must apply for a review of the premises licence for those premises if he is aware that there is being, or had been, carried on at those premises the sale, letting for hire, playing or exhibition of sound recordings,

films, broadcasts or cable programmes in circumstances which amount to an infringement of copyright for the purposes of the Copyright, Designs and Patents Act 1988 (c.48).

(1B) In subsection (1A) ''sound recordings'', ''films'', ''broadcasts'' and ''cable programmes'' have the same meaning as in Part 1 of the Copyright, Designs and Patents Act 1988 (c.48) (copyright).'.

The amendment is intended to protect the copyright laws and all those who have an interest in maintaining the proper and lawful methods of acquiring copyright material. Those who pirate music or films, or unlawfully access signals, harm the industries and the businesses that have lawfully gained the permission of the rights holders. The amendment would give the police extra powers to enforce the review of a licence if they knew that a breach of copyright had taken place. It would also further protect the personal licence holder and the designated premises supervisor by guiding them to obtain the necessary and proper permission for the use of copyright material, thereby avoiding potential prosecution.

The funds gained from producing and distributing pirated material often finance the further production of illegal material, and may fund other criminal activity. Those who allow pirated material to be used on their premises fail to understand the consequences and the seriousness of thieving intellectual property rights and the harm that that causes for their business, the right owners and the state, through lost tax revenues. Copyright theft is already a massive problem and we should be seeking to prevent it through legislation, such as the Bill, which gives us the opportunity to address the relevant issues. The amendment would remove the temptation to use pirated materials, and would make clear the consequences of such actions. Although the Opposition seek in principle to support a deregulatory Bill, the amendment is needed to close any gaps and to protect businesses in an industry that is suffering from a growing problem.

The amendment further seeks to raise the awareness of the public and licence holders of the seriousness of intellectual property theft, its effects on the economy and the consequences of such actions. The Copyright, Designs and Patents Act 1988 may no longer be sufficient to tackle a problem that is increasing throughout the world.

Many interested parties have a vested interest in protecting their rights under copyright laws, and in a Bill that could have a massive impact on the problems they are already facing, the Government must recognise those.

Kim Howells (Labour, Pontypridd)

I am glad that the hon. Gentleman has raised the matter; he knows that I feel strongly about the threat to our economy from IPR theft. This is an important issue. Our economy depends a great deal on creative industries, and the stealing of rights throughout the world is a serious matter. For all that, I cannot accept the amendment.

The amendment would make it compulsory for the chief officer of police to apply for the review of a premises licence in any instance where the sale, letting

for hire, playing or exhibition of sound recordings, films, broadcasts or cable programmes infringed copyright under the 1988 Act. The Bill contains no provision to compel interested parties or responsible authorities, such as the police, to apply for a review if an offence is committed on premises. The Bill rightly provides discretion for those authorities to decide for themselves when and in what circumstances to apply for a review.

I agree with the hon. Gentleman's description of the situation, and he has done us a service in bringing it to the attention of hon. Members. This is a serious crime. However, it would make no sense to remove the discretion to take the action that I have just mentioned. It would make even less sense if the police were compelled to apply for a review following an infringement of the 1988 Act when they are not compelled to do so for other more serious offences, such as those involving violence. The purpose of the review provisions in the Bill is to confer a right to request a review on interested parties and responsible authorities; it does not impose a statutory duty to do so.

If the amendment were accepted, although licensed premises at which fights regularly broke out might or might not be subject to review, the premises licence of a licensee who played one musical track to his customers for which he did not have the necessary permission would automatically be reviewed if the fact were made known to the police. I dare say that no one is more concerned about the theft of intellectual property that I am, but we have to put the matter in context. The Government take copyright infringement very seriously, and we have every sympathy with those affected by it.

Provided that the grounds for a review are relevant to the licensing objectives, are not frivolous, vexatious or repetitious, and are made by an interested party, the Bill does not restrict the range of concerns that may give rise to interested parties and responsible authorities applying for a review. A local cinema, for example, might make an application for licensed premises in the area, and might show films without having the necessary permission.

We have also reacted to industry concerns by amending the Bill to make certain offences under the 1988 Act relevant offences for the purposes of the Bill. Applicants for personal licences will be subject to review if they have committed any of those offences. That is an important modification. If an applicant has committed one of the offences, the licensing authority will be required to notify the chief officer of police. If he is satisfied that the granting of the licence would undermine the crime prevention objective, he must issue an objection notice. That would lead to a hearing at which the licensing authority would decide whether to grant an application or to reject it, if it believed that that was necessary to promote the crime prevention objective.

A personal licence holder who committed a relevant offence could have their licence suspended or forfeited. The amendment that the Government made underlines how seriously we take the issue, and will ensure that those who wish to be personal licence holders under

the new regime will be subject to appropriate scrutiny. Also, my officials are in discussion with the trade associations in the creative industry sector that are particularly concerned about the issue, such as the Cinema Exhibitors Association.

I do not think that amendment No. 225 is necessary, given the amendment made by the Government, which made a number of Copyright, Designs and Patents Act 1988 offences relevant offences under the Bill. I therefore hope that the hon. Gentleman will consider withdrawing it.

Malcolm Moss (Conservative, North East Cambridgeshire)

I am grateful to the Minister for his comments. Perhaps he could enlighten the Committee by pointing out, without going through every detail, where in the Bill it says that on application for a personal licence, offences under the 1988 Act would have to be disclosed? That would be of help. If he cannot do that right away—

Kim Howells (Labour, Pontypridd)

It is in schedule 4.

Malcolm Moss (Conservative, North East Cambridgeshire)

With all due respect, schedule 4 is quite large. Could we be told which line, please?

Kim Howells (Labour, Pontypridd)

Sorry, it is schedule 4, paragraph 12.

Malcolm Moss (Conservative, North East Cambridgeshire)

That is still not terribly specific, but we will take the Minister's word that the provision is there. I am sure that it is. However, it would have been useful to have had the line reference as well.

I take to heart the Minister's comment that if an applicant had a history of breaking the law in respect of copyright, that would be disclosed on a personal licence application. The police could then take action. I accept the Minister's argument that the wording of the amendment compels the police to ask for a review on the slightest hint that the law may have been broken. Obviously, that was not our intention—but I do not accept his analogy about regular fights in or outside a pub, and the police taking no action to initiate a review. That does not meet in any way the licensing objectives as set out in an earlier clause.

Nick Harvey (Liberal Democrat, North Devon)

The Minister said that the infringement of copyright was a basis on which relevant parties could raise objections. Does he believe that those whose copyright has been infringed can make those objections, or will they have to persuade the police to do so because they come into the category of interested parties—and is that another way in which we ought to approach this subject?

Malcolm Moss (Conservative, North East Cambridgeshire)

The hon. Gentleman makes a good point when he asks whether these people would be included under the umbrella of interested parties, but that is a question for the Minister rather than for me.

Kim Howells (Labour, Pontypridd)

I am sure that all of us have had some experience of dealing with these matters—we have seen it time and again in our Department—for example, where an approach is made to the police to investigate an occurrence in which intellectual property is being abused or stolen in one way or another. The police are a responsible body, and they can make representations to the licensing authority.

Malcolm Moss (Conservative, North East Cambridgeshire)

Again, that was a helpful contribution by the Minister. On balance, I take on board what he

has said on this amendment—that what it addresses is covered in other aspects of the legislation. We are still awaiting the precise page and line numbers of the relevant schedule, but we are patient: he can introduce it at a later stage of the proceedings.

Kim Howells (Labour, Pontypridd)

I thank the hon. Gentleman for his patience. The relevant offences are listed in schedule 4, paragraph 12, and the requirement to disclose convictions is in clause 121.

Malcolm Moss (Conservative, North East Cambridgeshire)

I am grateful to the Minister for that clarification. On that basis, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Malcolm Moss (Conservative, North East Cambridgeshire)

I beg to move amendment No. 286, in

clause 51, page 31, line 12, after 'interval', insert

'but in any event not less than three years'.

This is a probing amendment. Clause 51(5)(b) talks about ''a reasonable interval'' elapsing since an earlier application for review. We want to flesh out the Government's thinking about what is a reasonable time. The amendment adds;

''in any event not less than three years''.

We are putting a time scale on this.

It is reasonable that the review should not come back within that sort of period: otherwise, there will be a steady flow of potential complaints, particularly in certain instances. We can all think of pubs in residential areas that cause concern, and where that concern exists largely in the minds of local residents rather than because anything illegal is going on which might mean that there is any real basis for a withdrawal or revocation of that licence.

This is a probing amendment to find out what the Government think is a reasonable time: we think that three years is a reasonable period.

Mark Field (Conservative, Cities of London and Westminster)

I endorse the comments of my hon. Friend the Member for North-East Cambridgeshire, who sits on the Front Bench. It is essential that a level of certainty is brought about in relation to the review of premises licences for one main reason, which applies not only to the owners of premises or the licensees but to local residents' groups and other interested parties. There needs to be that sense of certainty and the word ''reasonable'' is open to a wide range of interpretations. I am unsure whether the Department issued any clear guidelines as to what it considers to be a reasonable interval.

Businesses are greatly concerned that there might be a level of uncertainty that means that they have no idea about how quickly they can reapply for an amendment to a licence—and that applies also to local residents and others who might have an interest. An inordinate amount of legal costs can be incurred and perhaps this is a charter for the licensing lawyers. The great concern is that residents, residents associations and local authorities will find themselves fighting a rearguard action. Given that we are going through the rigmarole of introducing new legislation, we should achieve certainty.

On an application for review, nothing is more depressing for Members of Parliament, or indeed for

local councillors, than feeling that a particular issue—be it a pub licence, a bar licence or any other licence covered by the Bill—is a running sore that is always in their postbag. As soon as a matter has been up for review, it will be argued that a reasonable interval has occurred, not least because the whole process may have been subject to appeal either in the courts or through various other sub-committees of the local authority under the current regime. It is essential that we get some guidance at this juncture. Given the importance of this Committee in guiding the courts, the Minister should give us an idea of what a reasonable interval would be.

Mark Hoban (Conservative, Fareham)

In addition to the costs imposed on businesses, which my hon. Friend the Member for Cities of London and Westminster mentioned, we also need to consider the costs that could be imposed on local authorities as a consequence of the range of interested parties who could call for a review. Clause 14 defines ''interested party'' as

''a person living in the vicinity of the premises, a body representing persons who live in that vicinity''

or

''a person involved in a business in that vicinity''.

All of those interested parties could apply at different stages for a review on a range of different grounds. If they call for a review, local authorities, which may feel obliged to instruct solicitors, will incur costs.

Clause 51(3)(b) requires

''the authority to advertise the application''

and to consult with the premises licence holder and any corporate bodies owning the premises that are subject to the review. A host of costs could be incurred by a local authority as a consequence of applications for reviews. It is important to protect the interests of council tax payers, as well as those of the businesses concerned, by ensuring that there is certainty and that a sequence of reviews, which will incur costs, will not be initiated by interested parties. That links back to the issue of frivolous and vexatious applications. I do not know what provision there is for those who make that type of application to have to foot the cost of the reviews and any costs incurred by either the licensee or the local authority. It is important from all perspectives that the ''reasonable interval'' referred to in clause 51(5) should be more specific.

Kim Howells (Labour, Pontypridd)

As the hon. Gentleman reminded us, amendment No. 286 returns to the theme of balance that has characterised the debate on this Bill at all stages and in both Houses. The Bill seeks to balance a number of different, often competing, interests, including those of the industry, local residents and the consumer at large. I believe that the Bill gets the balance right, subject to some of the important changes that we have made following the debate and consultation with key partners.

The system set out in the Bill for the review of existing premises licences is a critical element in that balance. It means that local residents will have a stronger voice than ever before in the licensing system.

They will be able to call for a review of any existing licence on a ground relevant to any of the licensing objectives. Clause 51 sets out the arrangements for applying for a review of a premises licence.

The hon. Member for Cities of London and Westminster mentioned that we have all experienced, as he put it, the ''running sore'' of a poorly managed house that generates constant complaints from local residents and local businesses, which is especially true in Soho. Since he said that, I have been trying to think of ones in my constituency, and I have suddenly realised that I do not have any such running sore—touch wood—so far. But the hon. Gentleman paints a very vivid picture. That can and does happen.

The review system is something of a balancing act. As I have said, we have given a stronger voice to local residents. By way of comment, that stronger position also extends to responsible authorities, which will also be able to seek a review of a licence. However, to protect legitimate, responsible and well-run businesses from individuals who may seek to use the powerful tools at their disposal in bad faith—this relates to the point made by the hon. Member for Fareham (Mr. Hoban)—the Bill introduces a number of important safeguards.

First and foremost, the grounds for an application for a review must be relevant to one or more of the licensing objectives. Among other things, that will make it more difficult for unscrupulous operators to make life hard for potential and actual competitors in the neighbourhood. We have not spoken much about that during our debates, but it can have a big effect. I have heard that where some of the more revolutionary of our pub chains have introduced very different kinds of premises into an area—often with good quality food, clear signage of the price of drinks and so on—objections have come not from local residents but from other pubs. They suddenly realise that they have a powerful competitor that is trying to improve the quality of their area, which means that they will have to invest in their own business. That is two edged. It pays tribute to the tremendous work of some responsible pub operators and chains and also says something about the less competitive performers in the field. We must ensure that such individuals do not prevent good investment in certain areas.

Where a representation is not made by a responsible authority, any ground for an application for a review may be rejected by the licensing authority if it is satisfied that it is frivolous or vexatious or if the ground is a repetition. I think that that answers the point made by the hon. Member for Fareham. A review does not have to be granted just because an application takes place. A review will not have to take place because someone happens to make a vexatious complaint. That is not the case.

Subsection (5) states that a ground for a review is a repetition if it is a ground already considered as part of an application for a premises licence, if it was a ground for a previous review of a premises licence or if it is an excluded representation under clause 32; and, in all cases,

''a reasonable interval has not elapsed since that earlier application for review or the grant of the licence''.

The nub of the question, as the hon. Member for North-East Cambridgeshire reminded us, is what constitutes a reasonable interval. The Bill's approach leaves that in the first instance to the discretion of the licensing authority. Amendment No. 286 would impose a minimum length of 3 years for that period. There are two related reasons why I cannot accept the amendment. First, different interest groups will have different interpretations of what might or might not constitute a reasonable interval. If we take that to extremes, some parts of the industry may want a long period to elapse before a ground may not be ruled out as a repetition. Indeed, they may want to exclude any representations made by local residents. That is understandable, given the usual commercial pressures, but it is unfair and not in the overall public interest of the new regime. On the other hand, some residents or their representatives or associations may regard it as unjust that any grounds should be ruled out because they are frivolous, vexatious or repetitious. That viewpoint was put plainly in another place.

Secondly, and more importantly, what constitutes a reasonable period will vary from one circumstance to another. If we set a minimum period in the Bill, I fear that we will expose ourselves to the risk of excluding perfectly legitimate grounds for review made by local residents under certain circumstances.

I shall consider some of the examples that were given by the hon. Member for Cities of London and Westminster. He clearly explained how circumstances can change within a commercial part of a town or city where business is dynamic and its nature changes quickly. In three years, many changes can occur and if malign influences are at work, a lot of money can be made at the expense of the people who live there and businesses, including other licensed premises that might be operating in the area. Perhaps we will discuss that further later. I shall not go into special promotions for alcohol sales, but the situation can become difficult.

It is much better to retain flexibility in the Bill, and rely on licensing authorities to exercise discretion. Licensing authorities that reject grounds for a review must give the applicant reasons for that decision. An aggrieved applicant will have the right to challenge any such decision by way of a judicial review, as the matter, if disputed, will ultimately be for the courts. On that basis, I hope that the amendment can be withdrawn.

Malcolm Moss (Conservative, North East Cambridgeshire)

I listened carefully to the Minister's explanation. Again, he is pleading for flexibility. However, if we accept that a time scale of any description will probably be inflexible, what is the point of including subsection 5(b) at all? Why have ''a reasonable interval'' if it means nothing? If, as my hon. Friend the Member for Cities of London and Westminster said, premises can change quickly—circumstances can change at a given environment with a different licence holder within a short period of weeks or months—the idea of a reasonable interval goes out of the window. The fact that it was only a few months earlier that objections were raised and

applications for review were made is irrelevant to the changed circumstances, so I cannot see the point of the reasonable interval.

I do not dispute the fact that the scene can change rapidly, and we need to be flexible to deal with that. With my probing amendment, I simply wanted to get a sense of the Government's thinking on the subject, but the Minister has ended up arguing for removing subsection (5)(b) entirely. I cannot press that idea to a vote, because that is not my amendment, but his comments leave in question whether we need the definition of paragraph (b) at all. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 52 - Determination of application for review

Malcolm Moss (Conservative, North East Cambridgeshire)

I beg to move amendment No. 287, in

clause 52, page 31, leave out line 39.

Roger Gale (Conservative, North Thanet)

With this it will be convenient to discuss amendment No. 288, in

clause 52, page 31, line 40, leave out 'three' and insert 'two'.

Malcolm Moss (Conservative, North East Cambridgeshire)

The amendment would remove subsection (4)(c).

Roger Gale (Conservative, North Thanet)

Order. I have just been told that we have a problem with the sound system, which means that Hansard is unable to take a correct record. I shall have to suspend the sitting briefly while the sound is sorted out.

Sitting suspended.

On resuming—

Roger Gale (Conservative, North Thanet)

I apologise for the delay. I believe that the sound is back on and that we will not have to suspend again. For the benefit of all concerned, we should go back to the start of clause 52, if you do not mind, Mr. Moss. I am not sure how many of your pearls of wisdom made the record.

Malcolm Moss (Conservative, North East Cambridgeshire)

I do not think that I had said anything. I had just got to my feet when you called time on events, Mr. Gale.

Amendment No. 287 would remove subsection (4)(c). Subsection (4) lists the steps that the authority may take at the time of determining an application for review. We could not understand why the authority should be responsible for removing the designated premises supervisor. After all, it can take various measures under subsections (4)(a), (b), (d) and (e). It can modify the conditions of the licence, exclude a licensable activity, suspend the licence for a period not exceeding three months or revoke it. Such onerous steps would have a significant impact on the business concerned.

It would seem logical in such circumstances for the premises licence holder to do something about the designated premises supervisor if activities were occurring under his or her supervision that led to problems and reviews. Therefore, it is logical that the owner of the business—the premises licence holder, in

particular—would do something about the designated premises supervisor who was in charge of the premises when the nefarious activities that led to the review occurred. The Bill should not include a power for the licensing authority to sack a designated premises supervisor, which is how we interpret the words in subsection (4)(c).

Amendment No. 288 would change the period in subsection (4)(d) from three to two months. Again, it is a probing amendment to get the Government's thinking on the matter. Why three months? It is an arbitrary period that may not strike the right balance. If a licence is to be suspended, the onus should be on the proprietor or the licence holder to get their act in order and continue trading at the earliest opportunity by facing up to the reasons for the review and accepting the strictures from the licensing authority or the police, as the case may be. They must ensure that changes are made so that the licence can continue.

In that context, we would have thought that two months would be more appropriate than three, so the suspension would be on a shorter time scale in order for the business to put right what it needs to and get up and running again. A suspension of three months or more would jeopardise a business in such a way that it could not continue at a later date.

I return to amendment No. 287, which is designed to question why the Government think it appropriate that a licensing authority at the end of a review—if it feels that certain actions need to be taken—can move in and sack a designated premises supervisor. After all, that person is appointed by the premises licence holder and not the authority in the first instance.

Kim Howells (Labour, Pontypridd)

This group of amendments concerns the steps that are available to the licensing authority after it has heard representations in a review hearing. Those steps may be taken if the authority considers them necessary for the promotion of licensing objectives. Their importance lies not only in the flexibility that they give to the licensing authority in dealing with a range of potential problems, but in their creation of a deterrent to those who operate problem premises, and especially those who fall just short of breaching conditions of their licences but fail to take remedial action to prevent emerging problems.

Although the powers will be essential for bringing premises generating problems in the community back into line, they will also give the owners and operators of the business pause for thought. With changes in trading hours, suspension and revocation of the licence all in the frame, business operators will need to think carefully about a number of matters, including—dare I say—the training of the staff working at those premises.

Under the existing system, where a manager often held the justices' licence, it was often a question of the manager's licence being revoked, and a new manager being brought in to obtain a new licence. The business was rarely threatened by such decisions, and as a result, problems could and did fester. The new system offers real flexibility in how individual problems are handled, and it provides the ability for the outcome of the review to impact directly on the business. For example, a reduction in trading hours will hit its profits, and cannot be ignored lightly.

Most of the businesses in the scope of the Bill are excellent, are run professionally and enhance our constituents' leisure time and our national life. There are some premises that cause problems, and we have to provide a suitable means of putting pressure on them and allowing problems to be remedied.

Amendment No. 287 would remove from the licensing authority's arsenal the power to require the removal of the designated premises supervisor. The Committee has already enjoyed a lengthy, detailed debate about designated premises supervisors. We have made our position clear, and I do not intend to repeat it this morning. The amendment does not serve the interests of the licensing authority, the industry or the community. It reduces the licensing authority's flexibility where the problems emerging at review clearly focus on the actions of a particular manager rather than the business itself. If a change in the designated premises supervisor would solve the problems, why go further than that? From the industry's perspective, would it really want the licensing authority to consider suspension or revocation of the premises licence because the facility of requiring a change in the supervisor is not available? I cannot believe that the industry would be well served by such a measure.

Similarly, in the community, premises such as a local pub may be a much prized local facility that has begun to cause problems following the arrival of a new supervisor. People would not necessarily want the pub closed, even temporarily, but they may well want a new supervisor who will set the right standards. It should therefore be possible for the licensing authority to consider those matters.

Amendment No. 288 would reduce the period of potential suspension of a premises licence from three months to two months. We set the level of three months because we considered that any matter justifying the closure of a business for more than three months would probably justify revocation in any case. We recognise that closure for three months could come close to killing many businesses. There is no question about that. Businesses will be able to plead that point before the licensing authority. Suspension can be from one day to three months, and that provides the flexibility to deal with a great range of problems.

What does reducing the level from three months to two achieve? It certainly reduces the flexibility available to the licensing authority. There is, of course, nothing magical about the period of three months—the hon. Member for North-East Cambridgeshire was quite right in that respect—but equally, there is nothing magical about two months.

Adrian Sanders (Liberal Democrat, Torbay)

Will the Minister clarify that the suspension could last between one day and a maximum of three months and is not set at three months?

Kim Howells (Labour, Pontypridd)

Yes, I am absolutely clear on that point. The decision made by the licensing authority would be proportionate to what it considered to be the offences. Of course, many decisions are made in that way now, in many spheres of life. Such flexibility is very important.

The key point is that suspension must act as a real deterrent to those who allow their businesses to drift into lower and lower professional standards that begin to impact on the community and the promotion of the licensing objectives. That is why I favour the higher and tougher level. I sincerely hope that it will have to be imposed rarely, if ever, but what matters is that it could be imposed and operators will know that.

Against that background, I hope that the hon. Gentleman will not insist on the amendments.

Malcolm Moss (Conservative, North East Cambridgeshire)

I am unconvinced by part of the Minister's explanation. I prefaced my remarks by saying that it was important that the licensing authority had powers to take action in instances in which reviews were upheld and there were real problems associated with particular premises. We have no problem with much of his argument that there should be recourse through the law for the licensing authority to take action against problem pubs and premises. However, I am still puzzled as to how a licensing authority will

''remove the designated premises supervisor''.

Subsection (3) states:

''The authority must, having regard to the application and any relevant representations, take such of the steps mentioned in subsection (4)''.

Subsection (4)(b) mentions ''to exclude''. The licensing authority must take steps

''to remove the designated premises supervisor''.

I do not see how it can. It is not employing the designated premises supervisor. Does that person not have any rights? What could happen, and seems more sensible in my estimation, is that the licensing authority will say, ''There is a problem with these premises. We believe that the problem stems from poor management and supervision. That is where the problems lies—there is no dispute about that.'' The authority would surely say, ''Unless you take steps to change the supervision and the management of the premises, there will be a suspension or a revocation.'' That is the sensible way to go about it, rather than giving a local authority the power to walk into a pub and say to a person, ''On your bike. Out you go,'' which does not make any sense to me. What about the human rights of the individual concerned? Certainly make the case that it is supervision and management that is the problem, but to include in the Bill powers for a local authority to go in and sack someone seems to me quite inappropriate. The Minister did not really address that issue.

Kim Howells (Labour, Pontypridd)

The designated premises supervisor is not sacked by the action. He would not lose his personal licence and he could work elsewhere. I will come on to the hon. Gentleman's specific point. If a supervisor were convicted of offences by a court, he might well lose his licence, but the licensing authority could not take his personal licence away in those

circumstances. Removal relates to the specification in the licence, not to that person's employment relationship. The hon. Gentleman will recall—I know that it seems like aeons ago now—that we had a long debate on that and on the specified name of the premises supervisor.

Malcolm Moss (Conservative, North East Cambridgeshire)

Although I am grateful to the Minister for that explanation, which makes a little more sense, the words in the Bill do not say that. It would be helpful if the Government could table their own amendment on Report to make it quite clear that it is the removal of the name of the designated premises supervisor from the licence that is meant. That is what he has just said, and that makes some sense. The licensing authority cannot remove the person in situ. The idea that the chap who was the cause of the review of the premises licence in the first instance still has employment rights and could be employed somewhere else does not fill me with great confidence.

Given the explanation that the Minister has given, I shall not press the amendments to a vote. Perhaps he will give some thought to making it quite clear what is meant by removal. It is removal only from the licensing certificate, not the effective removal of the person from the premises. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 52 ordered to stand part of the Bill.

Clauses 53 and 54 ordered to stand part of the Bill.

Clause 55 - Fees

Malcolm Moss (Conservative, North East Cambridgeshire)

I beg to move amendment No. 230, in

clause 55, page 33, line 5, leave out '(other than section 51)'.

Roger Gale (Conservative, North Thanet)

With this it will be convenient to discuss the following:

Amendment No. 130, in

clause 55, page 33, line 7, leave out paragraph (b) and insert—

'(b) prescribe guidance for licensing authorities when setting the amount of the fee and what may be charged for under the fee.'.

Amendment No. 226, in

clause 55, page 33, line 7, at beginning insert 'subject to subsection (5)'.

Amendment No. 227, in

clause 55, page 33, line 11, at beginning insert 'subject to subsection (5)'.

Amendment No. 132, in

clause 55, page 33, line 13, leave out subsection (4) and insert—

'(4) If the annual fee is not paid by the prescribed time, the relevant premises licence will lapse on that date.

(5) If a licence lapses under the provisions of subsection (4), the former holder of that licence may for a period of three months, commencing on the date the licence lapsed, seek reinstatement of the licence.

(6) The applicant for reinstatement shall pay to the relevant licensing authority the annual fee together with such reasonable reinstatement fee fixed in advance by that licensing authority.

(7) The premises licence shall be deemed to have been reinstated as soon as the requisite fees have been received by the licensing authority.'.

Amendment No. 228, in

clause 55, page 33, line 14, at end insert—

'(5) Regulations made under this section may prescribe circumstances in which any fee payable by virtue of this section may be varied (up to such maximum level as may be prescribed) by a licensing authority in order to take into account the cost to that authority of processing licensing applications.'.

Amendment No. 229, in

clause 55, page 33, line 14, at end insert—

'( ) In regulations made under this section, the Secretary of State shall prescribe a nil fee to certain categories of premises which shall include—

(a) church halls,

(b) village halls,

(c) parish halls,

(d) community centres, and

(e) similar community buildings.'.

Amendment No. 131, in

clause 90, page 51, line 38, leave out paragraph (b) and insert—

'(b) prescribe guidance for licensing authorities when setting the amount of the fee and what may be charged for under the fee.'.

Amendment No. 207, in

clause 90, page 51, line 38, after 'fee', insert

'or maximum fee, and may prescribe different fees or maximum fees for different qualifying club activities'.

Amendment No. 208, in

clause 90, page 51, line 41, at end insert

'in respect of such qualifying club activity or activities as may be prescribed'.

Amendment No. 209, in

clause 90, page 52, line 3, after 'fee', insert

'or maximum fee, including provision for different fees or maximum fees for different qualifying club activities'.

Amendment No. 133, in

clause 90, page 52, line 5, leave out subsection (4) and insert—

'(4) If the annual fee is not paid by the prescribed time, the relevant club premises certificate will lapse on that date.

(5) If a certificate lapses under the provisions of subsection (4), the former holder of that certificate may for a period of three months, commencing on the date the licence lapsed, seek reinstatement of the certificate.

(6) The applicant for reinstatement shall pay to the relevant licensing authority the annual fee together with such reasonable reinstatement fee fixed in advance by that licensing authority.

(7) The club premises certificate shall be deemed to have been reinstated as soon as the requisite fees have been received by the licensing authority.'.

Amendment No. 210, in

clause 194, page 107, line 34, at end insert—

'(aa) regulations under section 90'.

Amendment No. 211, in

clause 194, page 108, line 3, after 'containing', insert

'regulations within subsection (3)(aa) or'.

Given all of those, and the brevity of the clause, we had better treat this as a stand part debate as well.

Malcolm Moss (Conservative, North East Cambridgeshire)

Amendment No. 230 is a probing amendment, seeking clarification from the Minister on why all applications under the Bill require a fee except the review of the premises licence, which we covered under clause 51. Excluding that from fee

charging makes it possible that interested parties might call for reviews of premises licences for any reason—although vexatious reasons are covered earlier in the Bill—whether valid or not, as there is no fee or cost for the people making the complaint. There is, of course, a cost to the licence holder or holders, whether of premises or personal licences, if such issues are raised. The whole matter seems to be weighted in one direction.

We query the motives behind that exclusion, especially in the light of the need to fund reviews of premises licences from some source as yet unspecified. Do the Government envisage that those who instigate the review will meet the costs of carrying it out? If so, how will that be done? Perhaps an idea would be to put a charge on an application for a review but to refund that fee if the review leads to a successful conclusion and the complaint is upheld.

Amendments Nos. 226, 227 and 228 would introduce a new subsection (5), from which consequential amendments follow.

We remain unconvinced that the Government's assurances are enough to satisfy the worries of local authorities and licence holders about the regulation of fees. They claim that the system will be self-financing and that it will not burden licensees with excessive costs or leave local authorities with cost deficits for the administrative responsibilities of licensing.

Licensees fear a repeat of past experience when they paid fees, in some cases at ridiculous levels, to obtain public entertainment licences. They also have fears about the fairness of the proposed three-tier system and that local authorities will inherit a huge burden with massive financial consequences. The new computer systems will require new administration, additional working hours and other costs, which the licensing authorities will have to cover in their new role. Let us consider the consequential implications for the local authorities of street cleaning and transport systems. We know of the experiences of Soho and Westminster and are not convinced that such costs can be met by the Government's current proposals.

The self-financing scheme cannot succeed without a variation of the fees that are set, as suggested under amendment No. 228, with a maximum cap established to prevent undue costs from being recouped from the fees. As history has taught us, some local authorities have a fee structure for entertainment licences, which must make them a substantial profit. Naturally, we want to avoid that situation.

The situation, size and location of the premises should be taken into account when setting fees. For example, a venue in an urban area surrounded by several other licensed premises should pay a lower fee, owing to the fact that those premises also pay their contributions to the necessary costs. It is imperative that the system, as outlined in the draft guidance, is fair and workable for all parties and that the Government can ensure that a self-financing system will definitely work before they implement it.

Amendment No. 229 deals with those premises that will not be charged a fee. They will still have to make an application, but the Government have promised a nil fee. The amendment would insert such a proposal in the Bill, so that it makes it clear to all parties, especially those involved, that their applications will be received on a nil-fee basis. The new subsection would state:

''In regulations made under this section, the Secretary of State shall prescribe a nil fee to certain categories of premises which shall include—

(a) church halls,

(b) village halls,

(c) parish halls,

(d) community centres, and

(e) similar community buildings.''

There was much debate in the other place on the issue. In fact, the Government gained considerable ground by accepting the argument that such premises shall be subject to nil fees, when making applications. They promised that such matters will be dealt with in the guidance, rather than in the Bill. Nevertheless, in the interests of clarification and commitment, it is important that the nil-fee basis should be designated clearly and unequivocally and amendment No. 229 sets out to do that.

Amendments Nos. 207 to 209 apply to fees for clubs, which are dealt with in a different clause. It seems appropriate to deal with that matter while we are discussing fees. The Bill is inconsistent in its approach to club premises licences. For example, clause 1 stipulates that a club premises licence is necessary for both entertainment and alcohol. The exact wording in 1(1) is as follows:

''For the purposes of the Act the following are licensable activities . . . the provision of . . . entertainment, and . . . the provision of late night refreshment.''

In 1(2), both alcohol and entertainment are specified as qualifying club activities. On turning to clause 76, however, we see that qualifying club activities for which the premises might be used must be specified on the form of certificate. Clause 90 does not accommodate those various activities by prescribing different fees for them. There is therefore some concern, especially among small clubs, that one uniform fee will be imposed on all clubs, regardless of their activities, and that it would include the costs of fire and safety regulation checks, for example, and for the sound insulation necessary for an entertainment licence on top of the entertainment licence fee. The prescribed fee would be additional to the application fee and a possible annual fee.

Surely, such measures are not necessary for premises that are not used for entertainment as that is defined in the Bill and should therefore only be imposed on club premises where such activities are likely to take place. One such small club, from which I have had some representation, is Ramsgate croquet club—[Interruption.] There are lots of croquet, tennis and bowls clubs throughout the country; I happen to have been approached by that club, and it makes a strong argument. Ramsgate croquet club would not require the inclusion of entertainment in their premises

licence and would therefore be paying fees that were unrepresentative of its needs. It would be more reasonable if different fees were prescribed for different activities taking place on club premises. For example, if a club premises licence covered the sale of alcohol, not the provision of entertainment, the fee should be lower. That ought to be articulated in the Bill, so that specific provisions could be made for the benefit of the licensing authority and the clubs. By prescribing a maximum fee, clubs need not be charged for inapplicable administration fees and the licensing authorities will maintain the apparent flexibility afforded to them under other clauses.

Adrian Sanders (Liberal Democrat, Torbay)

The amendments are helpful; they are clearly intended to seek transparency in fee making and to get some definition of what is intended, which I hope the Minister will be able to give us.

The Minister gave me an assurance on fees at an earlier meeting, which was vitally important. The track record of some local authorities on fee setting is not good, certainly not in relation to public entertainment licences, which currently come under their remit. One local authority I know of has raised public entertainment fees from £200 to £2,000. Neither sum reflects the cost of granting licences. It is difficult for the Government to find a formula that enables local authorities to set a fee that matches their costs and there will need to be a great deal of consultation with local government to come up with the right levels of fees.

Amendment No. 229, which lists the premises to which nil fees will apply, is important, although the Government have already suggested that they want to exempt such properties. I am sure that we can all point to local examples of buildings such as community halls that have no other activities and are having problems keeping going. The requirement to pay a fee may well be what closes them. Then, there are other community halls—I know of one in my constituency—that have a bar and generate a great deal of income. Although the bar is only a part of the community centre, activities that take place in other parts of that centre may be directly related to the commercial activities of the bar. Distinguishing between the two will be difficult, and I imagine that it will be left up to officers of local authorities to determine which parts of the premises should have a fee attached.

Clubs, which the hon. Member for North-East Cambridgeshire mentioned, involve another set of complications. There are many small sports enterprises in my constituency; there are more bowling clubs than we can shake a stick at. Many of those clubs have bars and activities and some of those activities are held on behalf of other organisations. Sports clubs are good at holding charitable activities for other organisations. They have coffee mornings or wine and cheese evenings that generate profit for charity and not necessarily for the clubs.

It is crucial that we set the right climate of fees, to respect the variety of activities held in the clubs. It would be a tragedy if the Bill caused problems for such clubs and societies and if it meant that they had to disengage from some of their philanthropic activities, or if the imposition of fees affected the viability of

their activities. This is an important group of amendments that I hope will bring about transparency, so that it is obvious where fees are being directed. I hope that the amendments will also provide some definition as to what types of premises and activities we are talking about.

Mr. Field rose—

Roger Gale (Conservative, North Thanet)

I apologise, Mr. Field, because I should have called you first to speak to amendment No. 130, which stands in your name.

Mark Field (Conservative, Cities of London and Westminster)

Thank you, Mr. Gale. I wish to concentrate on amendments Nos. 130 and 132, which are both in my name. I shall not mention any croquet clubs. Ramsgate—which, of course, is just outside your constituency, Mr. Gale—has been mentioned; you, no doubt, are the life president of the Margate croquet club, for your sins.

Roger Gale (Conservative, North Thanet)

Order. I do not recall that that is one of my declared interests.

Kim Howells (Labour, Pontypridd)

Put the record straight.

Mark Field (Conservative, Cities of London and Westminster)

Yes, I am glad that the record has been put entirely straight on that point. It is just as well that Hansard's sound system is now working. We hope it is, anyway.

Much earlier in our deliberations, back in early April, the hon. Member for North Durham raised the costs of public entertainment licences in the city of Westminster and wondered whether all of the licence fee was put into enforcement. I have been able to conduct a certain amount of research into Westminster and the neighbouring borough of Kensington and Chelsea, the authority on which I sat as a local councillor for some eight years until 2002. I am acutely aware when discussing issues affecting central London that many Committee members are probably concerned that we should not forget that the country does not begin and end here in central London—although I would not necessarily support that contention.

My main concern with the Bill is that it is centralising in its authority. There is not the flexibility to take account of the fact that, without doubt, areas such as Soho and Covent Garden are sui generis in so far as two areas can be. The regime for central London should be considered differently from how the regime is considered elsewhere. Problems might arise from a set and centralised scheme for licensing and fees.

The hon. Member for North Durham (Mr. Jones) said that some of the fee income of Westminster city council is disproportionate to the costs of administration and enforcement. The implied conclusion was that Westminster was making a surplus income from the public entertainment licensing regime. Nothing could be further from the truth. I apologise in advance for boring the Committee with statistics that apply to a relatively small number of authorities—none the less, they make the point that we should not be overly prescriptive.

There are about 372 public entertainment licences in Westminster as a whole, two thirds of which are issued at a cost of £2,188 or less. About 31 per cent. of those PELs cost only £1,067 or less and only four venues in Westminster out of the 372 premises pay in excess of £20,000 for their PEL; we could all play a parlour game of guessing which they are, but I shall tell Committee members that they are the Royal Lancaster hotel, Westminster Central hall, the Hilton Metropole hotel and the Royal Albert hall. All those venues have extremely large capacities, and a frequency and variety of events that require robust enforcement. The notion that a set fee ceiling of about £2,000 or £3,000 would cover their costs flies in the face of fact. For instance, last year the Royal Albert hall paid the highest public entertainment licence fee of some £31,000, but for next year the licensing sub-committee of Westminster city council has reduced that to £18,000, having received various representations.

The Royal Albert hall has a capacity of 5,200, in excess of 1 million attendees to events annually and each year hosts 320 to 330 different events—almost one event per day on average. To ensure public safety, this world-renowned venue requires engineers from Westminster city council and licensing officers to visit at least weekly because of significant changes to scenery, stage and seating. Each visit usually requires a full day of officers' time, including at least four hours on site.

I have Westminster's statistics for the financial year just ended, on 5 April. It anticipates that public entertainment licences will provide a fee income of about £1,473,800 with expenditure of £1,794,300; in other words, there will be an operating loss of in excess of £300,000. The levels of fees are determined at present by a relatively straightforward formula that takes into account the capacity of the venue and the terminal hour.

The same sort of regime applies in the Royal Borough of Kensington and Chelsea, and similar statistics exist. The income fees of the tax year 2001–02 brought in £353,800, with expenditure of £376,000, so the deficit was in excess of £20,000. That local authority provided me with copious details to make it clear that the great costs incurred in officer time mean that although the fee regime might appear extremely generous compared with many other local authorities, it is not.

I hope that the Minister will give some thought to the amendment. Perhaps we will have to return on Report to whether we have the right mechanism for certain London authorities. That applies equally to Conservative authorities as to the stress areas of Camden, which also includes part of central London, and to a number of other London authorities that have real and distinct problems that are different from those envisaged under clause 55 in trying to introduce a fair and reasonable fee regime.

The Department for Culture, Media and Sport has said on numerous occasions that it will ensure that the centrally set application fee and an annual fee will cover all associated costs. That is a welcome assurance, but the Department must also recognise that there are

distinct problems in certain parts of the country. It is hard to envisage how the DCMS will come up with a ''one size fits all'' fee that does not involve local authorities making a loss or a profit.

Amendment No. 130 would still impose statutory regulations on fee setting so that there is certainty for business and to ensure that there is no suggestion of wild profits being made by a local authority, but it would also tightly control what may be charged for under the fee and how it should be calculated. Within those guidelines, local authorities will be able to set their own fee in consultation with licensees, residents and businesses. We hope that the outcome would be—to use a slightly vulgar phrase—a ''win, win, win'' scenario for licensees, residents and local authorities alike.

The rationale behind the amendment is straightforward and it was discussed in detail in another place. In Committee in the other place, Baroness Blackstone said that the Department was considering introducing a separate fee band for London and the south-east because of higher costs. That would be a step in the right direction, but that alone would not guarantee a fair licensing fee for local authorities and the licensees because there are several factors in determining licensing costs that can be determined only through self-determination—rather than by a regional-type scheme.

The two biggest factors are wage costs and travel expenses. Wage costs have an impact on every part of the application process, from policy development to inspections to enforcement and the actual process of applications. London weighting is an obvious example. There is a concern that if the Department calculated an average wage cost for the whole of England and Wales, London boroughs and metropolitan councils would lose money and rural councils with much lower wage costs would be able to make money.

On expenses, we accept that in more rural districts, where licensed premises are spread over a wide area, travel costs associated with inspection and enforcement will be far greater than they will be for inner city boroughs. Therefore, it is inappropriate for the Department to give a petrol allowance as part of the fee because many urban local authorities do not use such vehicles to get around.

There must be a sense of balance and there is a worry that a ''one size fits all'' approach would not produce the right result.

Adrian Sanders (Liberal Democrat, Torbay)

Economies of scale is another factor. For an authority that has a large number of premises, there are costs that can come down per application, but for an authority with few such premises the costs will be greater. I am arguing against my authority having more money, but that is part of the formula.

Mark Field (Conservative, Cities of London and Westminster)

That is a fair point. The Minister touched on it earlier. The level of expertise for a number of London authorities means that there is an opportunity for them to reduce some of the cost base simply because of the volume of applications being made.

Kevan Jones (Labour, North Durham)

I am grateful to the hon. Gentleman for dispelling the myth that Westminster city council is efficient and well run and that the taxpayers are subsidising the entertainment industry.

Does the hon. Gentleman also agree that, if there are a large number of entertainment venues in a small city area, managing them and travelling between them is a lot easier than dealing with licensed premises in a large rural county such as Durham where large distances have to be covered and lots of different types of licences have to be dealt with?

Mark Field (Conservative, Cities of London and Westminster)

I accept that. I will let the hon. Gentleman's initial comments pass by, although I fear that they are now on the record. I agree with the notion that a ''one size fits all'' scheme will lead to injustices on either side of the balance. It is fair to say that many local authorities operate their licensing regime at a loss rather than regarding it as a money-spinner. The Department for Culture, Media and Sport and some groups in the licensing trade believe that local authorities are making vast profits from the regime and no doubt use it as part and parcel of their lobbying schemes.

Baroness Blackstone said in another place that local authorities had had their chance to set fees, and in her view they had failed. As a result, the Government believe that they are justified in opposing a nationally set fee. It is widely acknowledged that a small minority of local authorities make some profit from the licensing fee, but most local councils operate at a huge loss, and will continue to do so on a much greater scale if there is a one-off fee of either £100 or up to £500, as stated in the regulatory impact assessment.

Many local authorities have struggled to estimate the true extent of the proposed change to the licensing regime, so I am reluctant to provide a projected figure, because it would be difficult to realise the size of the loss that would result. It would be invidious simply to multiply by £100 or £500 each of the licences that are now set at significantly higher levels. We have received little direction from the guidance so far, and local authorities have to rely on an assumption based on the experience and the expectation of their staff.

Enough evidence is emerging to highlight the worries of local authorities with a significant number of established licensed premises. Indeed, a fee case study covering Westminster and Camden—both sides of the political divide—was taken into account. Camden council considered that as councils take over responsibility for alcohol licensing under the new regime, there will be an associated increase in administrative costs for the processing of applications and conducting licensing meetings. That change will see Camden's licensing responsibility increase from about 175 premises, which include night cafes and other entertainment premises, to about 1,500 premises when all those with liquor licences are included. The council says that the guidance framework for the Bill notes that the Government's expectation that local authorities will receive a considerable income during the transition period may not come to pass, because that expectation is based on the fee income expected as existing premises transfer their licences to the regime.

Under the regulatory impact assessment, all licensed premises will be required to pay a one-off fee of between £100 and £500 during the transfer from the old licensing system to the new regime.

In the absence of any other direction when trying to work out its finances, Camden inevitably tended to consider the mid point in the range of fees—about £300. Given its new responsibilities, it reckons that it can expect revenue of £450,000 a year. It feels that the inadequacy of such fees is exposed by the fact that the current licensing regime in Camden, under which 300 licences—not 1,500—are processed annually, is already averaging £500,000. Some real problems lie ahead for several London authorities.

Westminster City council has built up a cost model to assist in preparing and planning for the enforcement work resulting from the Bill and its associated guidance. It has systematically identified the costs for a proactive inspection regime for each of the different types of premises, based on the number of premises and the frequency of existing visits for non-licensing purposes, as well as the other routine visits required. That is notwithstanding the point that the Minister and the hon. Member for Torbay (Mr. Sanders) made about the fact that many premises are close to each other, so there should be an opportunity to make certain savings. It is, however, felt that under the new regime the total enforcement costs in Westminster may be as much as £2.5 million.

Time is moving on and we have little more than 10 minutes to go, so I shall touch only briefly on amendment No. 132, the substance of which was tabled in another place by my parliamentary predecessor, Lord Brooke of Sutton Mandeville. Clause 55(4) says:

''Any fee which is owed to a licensing authority under subsection (2) may be recovered as a debt due to the authority.''

Local authorities are concerned about the huge cost and time implications of the proposed legislation. The law currently states that if someone does not pay the public entertainment licence fee before the licence expiry date—usually within 12 months—the licence will lapse until the operator pays the fee. The Government propose that the local authority will be able to chase up fees for licensable activity, not just for entertainment licences. That will, in the minds of many local authorities in London, cause significant problems. That is one of the reasons why we want to insert new subsections (4), (5) and (6); that would clarify the situation where there has been a problem with non-payment.

Thank you for allowing me to go into some detail, Mr. Gale. I am sorry that we will not be able to have a full debate on all the matters covered by the amendments, but I hope that the Minister will be able to satisfy us to a certain degree. Of course, we may return to the subject on Report.

Andrew Turner (Conservative, Isle of Wight)

I recognise that time is running on, but I would like to contribute to the debate.

The Government will get themselves into a hopeless hole on this matter. There are so many arguments on either side—for example, that the local authority monopoly could be abused, and also that different circumstances apply to different local authorities, an idea that my hon. Friend has put forward effectively. I shall illustrate those further by referring to a letter that I received from my local authority, which says that at the moment it more or less covers its costs—although I do not believe that it licenses anything like the number of things the Minister thinks it should, such as morris dancing in pub car parks. My local authority tells me that it makes a loss of £10,000 to £15,000 a year. It says that, for example, on one event—the Seaclose pop festival, which took place last year—the fee payable will be reduced from £8,000 to £500.

In order to set at rest local authorities' fears and concerns, it would be far better for the Government to allow local authorities more discretion than is proposed at present.

Kim Howells (Labour, Pontypridd)

In the little time left in this important debate, I shall try to answer some of the questions that have been asked.

The hon. Member for North-East Cambridgeshire asked about street cleaning costs and how they would be factored into the scheme of things. The fees and charges made under the Bill will recover the costs of administrative inspection and enforcement of the licensing regime; it will not and should not recover the costs of other matters, such as street cleaning, which are paid for through other forms of taxation by both businesses and consumers.

As for Ramsgate croquet club, fee levels and the location and size of businesses, we are discussing with all stakeholders how fees should be set to reflect the size and location of businesses. Rateable value includes both elements, and that is one possible basis for allocating businesses to bands of fees to be set out in statutory instruments.

Malcolm Moss (Conservative, North East Cambridgeshire)

I do not believe that Ramsgate croquet club—or any other small club—is a business; it is a small club formed for the enjoyment of a small number of people.

Kim Howells (Labour, Pontypridd)

I hope that the answer I gave clarified the Government's position on that subject.

The hon. Member for Cities of London and Westminster asked about the number activities taking place and the possibility of different fees being charged. To base the fee on the number of activities conducted on any premises makes no sense. The main cost of enforcement and inspection relates, as he pointed out, to labour costs and visits in connection with licensing. They will not necessarily vary because of the wide variety of activities that may take place on the premises; it is the labour costs and the visits that count. Clause 194 allows different provisions to be made for different purposes, and allows us to make provisions generally or in relation to specific cases.

The hon. Member for Torbay asked about local sports clubs. He will know, I am sure, that the Central Council of Physical Recreation has made

representations in favour of an exemption for local sports clubs. The Government are considering those representations at the moment. Hon. Members may be aware of the work that my right hon. Friend the Minister for Sport has done to make the benefits of charitable status more easily available to local sports clubs, and his work with the Treasury on the tax benefit package introduced in the Finance Act 2002.

The hon. Member for Cities of London and Westminster raised the issue of capacity levels. I was fascinated by what he said, and I am grateful to him for his efforts to give us some notion of the range of fees in one constituency. However, I do not understand why a capacity of 1,000 should give rise to licensing costs different from those involved when the capacity is, say, 2,000. Are more visits involved for the latter, and is more time spent on those premises? The case may be slightly different for somewhere as large as the Royal Albert hall, which the hon. Gentleman mentioned, but generally large venues, such as theatres of about the same size, will not involve that many administrative differences, and therefore not such high costs.

Mark Field (Conservative, Cities of London and Westminster)

What I was saying about the Royal Albert hall would, I suspect, apply to a number of similar premises in which many concerts take place, and there are many changes to the stage and scenery. Clearly, there would need to be plenty of regular visits in such a case. The capacity—between 1,000 and 2,000 or 3,000—may also reflect the sheer variety of events that take place, and frequent visits might be required to take account of new arrangements, and to ensure that health and safety aspects were taken properly into account, along with basic licensing matters.

Kim Howells (Labour, Pontypridd)

I thank the hon. Gentleman for that explanation. He has made clear his reservations—and, I assume, those of his local authority.

Kevan Jones (Labour, North Durham)

Will the Minister give way?

Kim Howells (Labour, Pontypridd)

May I make a little progress?

We are still discussing the exact level of fees with local authorities. I hope that the hon. Member for Cities of London and Westminster will draw some comfort from that. The intention is that fees will be set in bands, based on the size and location of the venues—and, in some circumstances, on how busy they are. My noble Friend Baroness Blackstone did not say in the other place that a special fee would be set for London and the south-east. She said that we would consider how a geographical element might be

included. That is being considered, but using rateable value as an indicator may serve that purpose.

As for fees and costs in the transitional period, Camden would indeed have an income of around £450,000 from premises during that period, but it would have no enforcement costs during the year to 18 months or so of transition. It would have an income of at least another £45,000 in respect of personal licences during the transition—that is £5,000 less than the £500,000 estimate made by the hon. Member for Cities of London and Westminster.

Mr. Field rose—

Kim Howells (Labour, Pontypridd)

I will not give way again, if the hon. Gentleman does not mind.

I hope that after those reassurances, the amendments will not be pressed. If they are, it will send a strong signal that Opposition Members are willing to damage the livelihoods of some of the lowest paid employees in our economy just to save a few coppers for the local authority.

Malcolm Moss (Conservative, North East Cambridgeshire)

The Minister was doing all right until that last specious, throwaway comment on the politics of the issue. As he rightly said, the Government are still discussing the local authorities' fee structure. What he did not say, but we have been told, is that considerable problems and difficulties have still not been ironed out. I would have thought that it was still nearly impossible to get general agreement because of the conflicting needs and requirements across local authorities, and because of geographical circumstances. We wish the Government speed in coming to a conclusion on the subject, but we recognise that that will be difficult.

It is true that there needs to be flexibility—

It being twenty-five minutes past Eleven o'clock, The Chairman proceeded, pursuant to Sessional Order D [29 October 2002] and the Order of the Committee [1 and 3 April 2003], to put forthwith the Question already proposed from the Chair.

Amendment negatived.

The Chairman then proceeded to put forthwith the Question necessary to dispose of the business to be concluded at that time.

Clauses 55 to 59 ordered to stand part of the Bill.

Adjourned at twenty-six minutes past Eleven o'clock till this day at half-past Two o'clock.

Standing Committee D

Licensing Bill [Lords]

Clause 61 - Qualifying clubs

Malcolm Moss (Conservative, North East Cambridgeshire)

Welcome back to the Chair, Mr. Benton.

Under clause 61, there still seems to be the outstanding issue of the Caravan Club of Great Britain. The club has approached the Minister on more than one occasion; I am informed that the last time was on 18 March and at that meeting some assurances were given that have not been followed up either in writing or by the Minister himself. Perhaps he can use the clause as an opportunity to give a definitive ruling as to whether the club would be a qualifying club under the requirements of clause 61.

The club's normal activities are associated with national, regional and local meetings and rallies, and it is not engaged in regulated entertainment. There is no dispute about whether the club's activity comes under schedule 1(2). The entertainment, if anything, is exclusive to the rally participants, who are club members and not members of the public, and the club was given the assurance that it was not a qualifying club under clause 61. As we also know, its provision of entertainment is not

''for consideration and with a view to profit''.

The club needs assurances that it will not be caught in the net by doubt over whether it is a qualifying club. If it is a qualifying club, it would have to seek licences and address the problems that many outdoor activities have in working out how a licence applies—for example, does the licence apply to a field, or a locality? It would have to tackle all those questions that relate to the temporary provision of licences, which is covered later in the clause. It would be helpful if the Minister clarified the situation for the Caravan Club, which has been waiting for a response for about six weeks.

Kim Howells (Labour, Pontypridd)

I, too, welcome you to the Chair, Mr. Benton.

I am surprised that the Caravan Club has chosen not to approach me directly about the matter that the hon. Gentleman raises. I had a productive meeting with representatives of the club, which included one very keen member, my hon. Friend the Member for Barnsley, Central (Mr. Illsley). On the basis of the information that the club has so far given to us, it does not appear that it is a qualifying club under the Bill,

but we shall keep the matter under review, and I shall try, as the hon. Gentleman suggests, to get in contact with the club again.

Question put and agreed to.

Clause 61 ordered to stand part of the Bill.

Clause 62 - The general conditions

Malcolm Moss (Conservative, North East Cambridgeshire)

I beg to move amendment No. 302, in

clause 62, page 36, line 10, leave out 'two' and insert 'four'.

Joe Benton (Labour, Bootle)

With this it will be convenient to discuss the following:

Amendment No. 235, in

clause 62, page 36, line 10, leave out 'two days' and insert '48 hours'.

Amendment No. 316, in

clause 62, page 36, line 10, leave out 'two days' and insert 'one day'.

Amendment No. 203, in

clause 62, page 36, line 12, after 'club', insert

'unless the right to become members without prior nomination or application is thereby completely excluded,'.

Amendment No. 317, in

clause 62, page 36, line 14, leave out 'two days' and insert 'one day'.

Malcolm Moss (Conservative, North East Cambridgeshire)

There is a little confusion owing to of the number of amendments that were tabled over Easter. We have tabled a range of amendments that refer to different hours, days and weeks and I will try to make some sense of them.

Essentially, these are probing amendments. We want to elicit the Government's reasons behind some of the periods of time that appear in clause 62. It is my understanding that the interval of two days is lifted from the Licensing Act 1964: presumably, that has worked reasonably well. One of our amendments changes that interval to 48 hours because in some circumstances two days might not give the appropriate authority sufficient time—for example, if the application came towards the end of a day. The amendment changes two days to 48 working hours, which should enable the necessary work to be completed properly.

Amendment No. 203 inserts the following phrase after ''club'' in line 12:

''unless the right to become members without prior nomination or application is thereby completely excluded.''

That is a form of words that seeks to make some sense of this subsection, which refers to ''Condition 2''. I think that that is lifted from the 1964 Act. It gives rise to a strange interpretation in club rules around the country. The original legislation is unclear, and we do not think that the new wording in subsection (3) makes it clearer for those who run these clubs and have to set down their rules and regulations. Amendment No. 203 seeks to clarify and simplify the meaning and wording of the provision, while maintaining the prevention of instant membership to a club to partake of a drink, which is the reason for the two-day delay. This amendment would prevent the need for fairly incomprehensible sentiments being incorporated into a club's constitution. It would lead to a slightly

elongated subsection, but at least it would provide greater clarification of what is intended.

Amendment No. 302 probes why two days cannot be extended to four days, if the reason is to prohibit anyone from quickly joining a club to enjoy the benefits of its alcohol licence.

Kim Howells (Labour, Pontypridd)

I am glad that the hon. Gentleman has chosen to clarify that because I was confused by it. Could he tease out a bit more why four days and two days appear in the same set of amendments?

Malcolm Moss (Conservative, North East Cambridgeshire)

I prefaced my remarks by saying that there had been a certain amount of confusion over the Easter recess and we have a strong combination of alternative amendments. As they are probing amendments, that is not worth getting too upset about. Their main purpose is to get the Minister to justify why he has set down the two-day period.

Kim Howells (Labour, Pontypridd)

We have moved on to the part of the Bill that deals with clubs. The Government recognise that there is much to be valued in this country's club movement. Different considerations arise in relation to clubs, which are private premises to which public access is restricted. That is why they are treated separately from pubs, bars and other licensed premises; that is why the supply of alcohol for consumption by members and guests on premises for which a club premises certificate is in force are subject to a different regime with lighter controls.

The clause sets out five conditions that a club must satisfy to be a qualifying club and be eligible for a club premises certificate. It is important that the conditions are strong enough to enable a clear distinction to be drawn between bona fide members clubs and commercial undertakings. The hon. Gentleman is hedging around that simple question.

The first condition in subsection (2) is that

''under the rules of the club persons may not . . . be admitted to membership, or . . . as candidates for membership, to any of the privileges of membership, without an interval of at least two days between their nomination and or application . . . and their admission.''

As the hon. Gentleman told us, that has been the case since 1964 and it has been that way for as long as I can remember.

Mark Field (Conservative, Cities of London and Westminster)

On gaming, there has classically been a 24-hour rule, although I appreciate that that is all subject to review and that we are dealing with a different regime. Will the Government try to introduce some consistency? The 48-hour time limit is arbitrary, whether or not it is sensible, whereas the 24-hour rule has been the norm for joining large-scale gaming and gambling clubs. What is the rationale behind maintaining the 48-hour limit, rather than increasing it to 96 hours, as suggested in one amendment, or reducing it to 24 hours, which is common in casinos in central London?

Kim Howells (Labour, Pontypridd)

The hon. Gentleman is right to remind the Committee that we are reviewing gaming and gambling law with a view to introducing some radical changes soon. Under the proposed gambling reforms,

bingo clubs and casinos that hold operator's licences and specialised forms of premises licences would no longer be subject to a 24 or 48-hour rule. However, non-profit-making members clubs, such as those that would hold club premises certificates under what will become the Licensing Act, would enjoy certain exemptions relating to lower levels of gambling and prizes, as long as the 48-hour rule on membership, among other things, is applied. There is nothing inconsistent about the two policies: both offer forms of privilege and exemption, subject to certain qualifying conditions and both have the 48-hour rule in common. Nevertheless, I am glad that the hon. Gentleman has drawn our attention to the fact that there are some big changes in the offing for gaming and gambling.

Under clause 62(5) the fourth general condition that must be satisfied in order for a club to meet the criteria for qualifying club activities is that it must have at least 25 members. Amendment No. 235—

Joe Benton (Labour, Bootle)

Order. Perhaps I should point out to the hon. Gentleman that we are dealing with the next group of amendments.

Kim Howells (Labour, Pontypridd)

I have here amendments Nos. 302, 235, 316, 203 and 317.

Joe Benton (Labour, Bootle)

Order. The hon. Gentleman is referring to No. 204, which is the next amendment.

Kim Howells (Labour, Pontypridd)

I am sorry, Mr. Benton, I need some guidance. I thought we were considering clause 62, amendments Nos. 302, 235, 316, 203 and 317.

Joe Benton (Labour, Bootle)

Order. That is correct. I do not know whether I added to the confusion by mentioning amendment No. 204 at the outset, which I should not have done. That will be the next sequence of business.

Kim Howells (Labour, Pontypridd)

Would it be in order for me to deal with amendment No. 235?

Joe Benton (Labour, Bootle)

Yes.

Kim Howells (Labour, Pontypridd)

Thank you, Mr. Benton—a great mist descended then.

Amendment No. 235 would replace the requirement of at least two days' notice between nomination or application for membership and admission with one of 48 hours. The interval of two days has not been plucked from the air. As the hon. Member for North-East Cambridgeshire (Mr. Moss) reminded us, it has been carried over from the present law as set out in section 41 of the Licensing Act 1964. The amendment would substitute a minimum delay of 48 hours for the two days that the law requires at present. The hon. Gentleman's amendment does not mention 48 working hours. It merely states ''48 hours'', which has nothing to do with the hours that the licensing authority may be working. The two days in the Bill is about the period of notice that an applicant must give before being admitted to membership and a licensing authority is not involved in that.

On the face of it, this might seem a fairly harmless adjustment, but we take the view that it is important not to weaken or undermine the distinction between bona fide clubs and others. The two-day test in the

present law is well established, and we are not persuaded that a compelling case has been made for disturbing it. In our view, the additional inconvenience of a two-day interval is a reasonable price to pay for maintaining an important legal distinction.

I now turn to amendments Nos. 302 and 316. There may be a case for the Opposition Members to put their heads together and—as I tried to express as gently as I could—make up their minds about whether they want two days, 48 hours or four days. Amendment No. 316 would do completely the opposite of any of those options, by reducing the period to one day. I am sure that if the Committee had a clear idea of what the Opposition wanted, we could be a bit more helpful—but I fear that the arguments would be the same. Two days reflects the existing position; it is fair and reasonable and offers the necessary degree of protection to all concerned.

Amendment No. 203 would make it clear that the rules of a club may prohibit a person from becoming a member of it without prior nomination or application. However, it would leave unaltered the position currently established by subsection (3) that if the rules of the club allow a person to become a member without prior nomination or application, those rules must also provide that such an individual may not be admitted to the privileges of membership without an interval of at least two days between their becoming a member and their being admitted. That period would be reduced to one day by amendment No. 317, which we must resist on grounds similar to those on which we resist amendments Nos. 302 and 306. Therefore, amendment No. 203 would not have any material effect on the provisions of the Bill, and it is unnecessary. There is nothing in the Bill that prevents a club's rules from prohibiting someone from becoming a member without prior nomination or application; that is a matter for the club.

I assure the Committee that in this respect the Bill reflects the provisions of the current legislation on registered clubs, so no difficulty should be caused for clubs that currently operate satisfactorily. I hope that after those reassurances, this group of amendments will not be pressed.

Malcolm Moss (Conservative, North East Cambridgeshire)

I am grateful to the Minister for those comments. I prefaced my remarks by saying that there had been some confusion, and I apologise to the Committee for that.

Amendment No. 203 is still hanging up there, because the Minister did not shoot it down in flames. He said that it would help clubs whose rules say categorically that a prior application and nomination is needed before someone can become a member. The current wording of the Bill, which is lifted from the Licensing Act 1964, simply causes difficulty for clubs that insist on prior application and nomination, because they then have to write in if, for whatever reason, someone comes along and gets signed up on the night—and such people still have to wait two days before they can have a drink.

The wording of amendment No. 203 would add to the Bill: it would not detract from it, but would clarify the situation and help clubs that have in their statutes

a requirement for prior application and nomination, which is the proper way to do things. As for preventing any abuse of the system—for example, people simply walking in, signing up and having a drink at the bar—to insist on prior nomination and application on the form provided by the club would be more watertight than what is in the 1964 Act, which the Minister wants to include verbatim in the Bill. As he said some kind words about amendment No. 203, perhaps he could ease a little towards our position by examining our suggestion further, with a view to including it.

Kim Howells (Labour, Pontypridd)

I always examine with meticulous care the suggestions offered by the hon. Gentleman, and I shall certainly do so in this case.

Malcolm Moss (Conservative, North East Cambridgeshire)

On that basis, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Malcolm Moss (Conservative, North East Cambridgeshire)

I beg to move amendment No. 204, in

clause 62, page 36, leave out line 18.

The amendment would simply delete clause 62(5), which states:

''Condition 4 is that the club has at least 25 members.''

The amendment would prevent clubs with fewer than 25 members from being at a disadvantage. If such a club wishes to acquire a premises licence, why should it be prevented from doing so? What is magic about the number 25? Surely it is for the club to decide what its membership should be on the basis of its financial situation, and clause 62(5) is needless.

I am aware that there is a limit of 25 members in existing legislation, but there must be a number of small clubs in villages—for example, bowls clubs—that would find that difficult to reach. Even the Ramsgate croquet club—to mention another distinguished club—might find it difficult to reach the limit, and if a club does not have 25 members, it cannot register as a club and enjoy the accompanying benefits. Ramsgate club would not be allowed a licence, so it might be entertained by the bigger Margate croquet club, which was mentioned this morning, and which could have a bar and be able to offer drinks, but it would not be able to reciprocate. Why is there an arbitrary limit of 25?

Andrew Turner (Conservative, Isle of Wight)

Could it be that the Government did not intend such a small, unincorporated association or club to be licensed at all?

Malcolm Moss (Conservative, North East Cambridgeshire)

That could be a better plan, but I do not suppose that the Government will want to go down that road either.

The amendment would help smaller clubs, of which there are many throughout the country. Under the Bill, no club with fewer than 25 members can apply for a bar licence and serve drinks after a game, and that is an unnecessary restriction, bearing in mind that many such clubs would not cause any problems for the police or the local community. In any event, with such small numbers involved there is unlikely ever to be any cause for concern.

Kim Howells (Labour, Pontypridd)

I remind the Committee that the reason why the Bill preserves the special arrangements

for clubs and does not require them to obtain a full premises licence, as other establishments must do, is because they have a special role to play in the community. The minimum membership requirement also recognises that community role. Without it, there would be nothing to stop a small number of people circumventing the normal requirements of licensing law, and setting themselves up as a qualified club. Clubs with fewer than 25 members can be recognised clubs, and apply for a premises licence—

Malcolm Moss (Conservative, North East Cambridgeshire)

At an even greater cost to the small club.

Mark Hoban (Conservative, Fareham)

My hon. Friend made the point that I was about to make. We are in danger of imposing a greater regulatory burden on smaller clubs than on larger clubs.

Martin Linton (Labour, Battersea)

Conservative clubs, perhaps.

Kim Howells (Labour, Pontypridd)

That is a cruel remark, although I know that in Wales and Scotland, for example, the membership of Conservative clubs has shrunk dramatically. In fact, to depart from the script for a moment, I must say that I was 19 years old before I discovered that the ''Con club'' in Hirwaun was really the Conservative club. I thought that it was something to do with snooker, because it had the two best tables in the valley. I never met a Conservative until I was well into adolescence. Even now, the Hirwaun Conservative club has at least 25 members.

I do not recognise the description of the struggling clubs. I accept the point made by the hon. Member for North-East Cambridgeshire about the ubiquitous Ramsgate croquet club, but I must undertake some research to find out whether it exists. I am sure that it does, but the minimum membership of 25 people also reflects the provisions for registered clubs under the 1964 Act, and they seem to work perfectly well.

Malcolm Moss (Conservative, North East Cambridgeshire)

Let us take a hypothetical case of a club with 25 members. It would fulfil the requirements of clause 62(5) and, as the Minister said, it would be entitled to the benefits that qualifying clubs would receive under the Bill. Let us say that the club has a bar and a licence under the club provision. What would happen if one of its members dropped dead? It would then have only 24 members. Does all activity cease? Will the bar have to close down? The club would probably whip someone in off the street and sign him up. The other members would be able to drink, but the guy who had just signed up would not be able to do so for two days. Such matters are worth thinking about.

Kim Howells (Labour, Pontypridd)

That would have to happen the day before the club applied to be a qualifying club, and the hon. Gentleman knows that such incidents would rarely occur. I am reliably informed that the Bill gives the club a three-month period of grace. If a club with only 25 members, one of whom has suddenly dropped dead, cannot attract another member within three months, it really is on its last legs. The rest of the membership could be in danger of dropping dead, too.

Bob Blizzard (Labour, Waveney)

I can cite the example of another sort of Con club in Lowestoft, which I visited for the first time on Saturday night—the Constitutional Club. It is a most select and private club with 30 members, and it has realised that if its membership went much below 30, it would be difficult to continue anyway. Twenty-five is a good figure for membership; it is fair to say that it would apply to any club that was to remain in existence.

Kim Howells (Labour, Pontypridd)

I agree, and I hope that the hon. Member for North-East Cambridgeshire withdraws his amendment.

Malcolm Moss (Conservative, North East Cambridgeshire)

I am reassured by the Minister's saying that the Bill will enable a club to continue for three months if it does not reach the membership requirement. There may be other requirements, but I have not found such a provision.

Kim Howells (Labour, Pontypridd)

I can inform the hon. Gentleman that he will find the provision in clause 88.

Malcolm Moss (Conservative, North East Cambridgeshire)

I am most grateful to the Minister. In that case, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 62 ordered to stand part of the Bill.

Clause 63 - Determining whether a club is established

Mark Hoban (Conservative, Fareham)

I beg to move amendment No. 318, in

clause 63, page 36, leave out line 26.

Joe Benton (Labour, Bootle)

With this it will be convenient to discuss amendment No. 303, in

clause 63, page 36, leave out line 36.

Mark Hoban (Conservative, Fareham)

I thought that I would break with tradition and move this amendment myself. These are both probing amendments intended to allow us to consider what is meant by whether a club is

''established and conducted in good faith''.

Clearly, the clause is important for determining whether an organisation is declared to be a bona fide club.

Amendment No. 318 relates to subsection (2)(a), which refers to any arrangements that have to do with

''the club's freedom of purchase of alcohol''.

What impact will that provision have on a licensing authority that is considering a club's arrangements for the purchase of alcohol from a brewery? I am well aware that some clubs have an agreement that requires them to take a certain amount of beer from a particular brewer. Quite often, that agreement is tied to the provision of a loan from the brewery to the club, perhaps to refurbish premises or provide working capital.

When I was a student, the bar in our hall of residence was funded by one of the brewers—I think that it was Samuel Smith's—which provided a generous loan to refurbish it. I am not quite sure what the outcome of that refurbishment was, as the

bar still looked pretty basic to me. However, the money had been supplied, and I am sure that we were all very grateful to the company for supplying it. Student unions are not the only such clubs. The Fareham Conservative club had a similar arrangement with a local brewer.

It is important for those of us seeking to interpret subsection (2)(a) that the Government help us to understand how important the arrangements are, and to what extent the closeness of the tie between the club and the brewery means that the club is no longer

''established and conducted in good faith''.

Amendment No. 303 refers to subsection (2)(e), and raises questions about the nature of the premises of the club. When my hon. Friend the Member for North-East Cambridgeshire spoke in the stand part debate on clause 61, he referred to the Caravan Club, which clearly felt that the fields where it held its caravan rallies would be appropriate premises for the purposes of clause 63. I am not sure that that is the case. However, what is it about the nature of the premises of a club that will determine whether the club is

''established and conducted in good faith''?

I have been to sports clubs—at least, they would probably fall into the category of clubs—where the premises were very basic, and there was not much to them. Equally, I have been to clubs that are much more lavish and well appointed, and there are a range of clubs in between.

It is important that the local authorities taking on responsibilities as licensing authorities under the Bill, and the club operators and their lawyers, understand what is meant by paragraphs (a) and (e).

Kim Howells (Labour, Pontypridd)

I thank the hon. Gentleman for his explanation of the amendments. As has already been said, we believe that there is much that is worthy of preservation and encouragement in this country's club movement. Different considerations arise in relation to clubs, which, as I have said, are private premises to which public access is restricted. That is why they are treated separately from pubs, bars and other licensed premises, and why the supply of alcohol for consumption by members and members' guests, on premises for which a club premises certificate is in force, are subject to a different regime, with lighter controls.

Unfortunately, the very fact that the controls are lighter makes the special arrangements for clubs—both those operating under the current system and those that will operate under the Bill—a potentially attractive option for unscrupulous people who wish to circumvent licensing controls. That is why clause 63 sets out the matters that may be taken into account by the licensing authority when determining whether a club is established and conducted in good faith for the purposes of the Bill. Two of those matters are any arrangements restricting the club's freedom of purchase of alcohol, and the nature of the premises occupied by the club.

Amendment No. 318 would remove the licensing authority's ability to take into account any arrangements restricting the freedom of the club to

purchase alcohol when determining whether it is conducted in good faith. Amendment No. 303 would remove the licensing authority's ability to take into account the nature of the premises occupied by the club when determining whether it was conducted in good faith. The amendments concern measures that reflect provisions in the Licensing Act 1964 that prevent unscrupulous individuals from circumventing the licensing laws altogether, or seeking to pervert them for their own monetary gains. We have decided, entirely justifiably, to maintain those provisions in the new regime, notwithstanding the special arrangements that we have made for clubs.

It is right that licensing authorities should be able to take into account any arrangements, usually arising from the rules of the club, that restrict its freedom to purchase alcohol. An example of such an arrangement would be where alcohol can be purchased only through a specified individual. He or she may have used inappropriate influence to gain that position, perhaps over a number of years, and might, furthermore, use that position for financial advantage. The scrutiny of any such arrangements by the licensing authority offers a workable safeguard against such malpractice. I hope that after that reassurance, amendment No. 318 will be withdrawn.

It is right that the licensing authority should be able to take into account the nature of a premises when determining whether a club is conducted in good faith. Again, that arises from problems that were identified and addressed by the Licensing Act 1964, whereby accommodation that would normally be associated with the provision of a justice's on-licence was being claimed as constituting club premises. The measure is designed to prevent an individual or a group from forming a committee and claiming that the premises were used for qualifying club activities, when in reality it was used for sales to the public. We think it right that that safeguard should be continued, and I hope that the hon. Member for Fareham (Mr. Hoban) will have the confidence not to press amendment No. 303.

Mark Hoban (Conservative, Fareham)

I am grateful to the Minister for his reply on those amendments. On his response to amendment No. 318, I can understand his argument about one person who may have used unscrupulous methods to acquire the right to supply alcohol to a club. However, if that is one extreme of the scale, compared with having completely free arrangements for the supply of alcohol, I am not sure where on that scale some of the existing arrangements with brewers sit. How concerned should a licensing authority be about the nature of tied, or close, arrangements between a brewer and a club?

Perhaps licensing authorities need to be provided with some more guidance on how to analyse such relationships to see whether an agreement to buy a certain amount of beer per year, for example, is a legitimate commercial arrangement that serves the interests of the club and its members, or whether it precludes them from benefiting and creates an unpleasant or difficult relationship between the brewery and the club. Perhaps some guidance needs to be issued to licensing authorities to help them to decide. On that basis, and subject to the reservation

mentioned, I shall be happy to withdraw amendment No. 318.

On amendment No. 303, the Minister raised a concern about the use of premises for what amounted to the sale of alcohol to the public. However, the condition in clause 62 would prevent easy sale of alcohol to the public, because there is a two-day period between people applying to join a club and being able to buy alcohol there. That will slow down the process and make it more difficult for premises to be used simply for the sale of alcohol to members of the public who come in from the streets to take advantage of some of the benefits that clubs may offer. Having said that, I understand the point that the Minister made about control of premises, but at a time when we are encouraging more public involvement in the licensing process, I wonder whether some of those arguments may be used to prevent the granting of a licence to new clubs.

I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Mark Hoban (Conservative, Fareham)

I beg to move amendment No. 319, in

clause 63, page 36, line 39, at end add—

'(4) In the event that a notice is issued as a consequence of a decision in subsection (3), the club can appeal to the magistrates under section 178.'.

Joe Benton (Labour, Bootle)

With this it will be convenient to discuss the following:

Amendment No. 320, in

schedule 5, page 122, line 25, at end insert—

'Determination that a club is established and conducted in good faith

9A Where under section 63(3) it is determined that a club is not established and conducted in good faith, an appeal may be made to local magistrates.'.

Mark Hoban (Conservative, Fareham)

To follow on from the Minister's comments about the importance of the matters in subsection (2) that a licensing authority may consider when ensuring that a club has been established and conducted in good faith, the licensing authority is required to issue a notice to a club if it does not meet the conditions set out in clause 63, but I cannot see in the Bill a right of appeal from the club to magistrates to enable it to dispute the licensing authority's findings as to the way in which the club has been established and conducted. I hope that there is provision in the Bill to enable licensing authorities to be challenged in a magistrates court so that any issues raised by a licensing authority about the way in which a club has been established and conducted can be properly aired.

Kim Howells (Labour, Pontypridd)

I wonder whether I can reassure the hon. Gentleman by saying that at this stage I am not persuaded that an appeal to magistrates is necessary, and that the Joint Committee on Human Rights did not see fit to comment on that aspect. However, the hon. Gentleman raised an interesting point and I am prepared to look again at the matter and, if necessary, return with an appropriate amendment on Report.

Mark Hoban (Conservative, Fareham)

I am grateful for the Minister's comments, and take note of what he said. It is important that clubs be given a right of appeal when appropriate. However, given the Minister's assurance, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Question proposed, That the clause stand part of the Bill.

Malcolm Moss (Conservative, North East Cambridgeshire)

When I was looking at the White Paper and the guidance on clause 63, I came across the following words in paragraph 101 on page 42 of the White Paper:

''The law relating to registered clubs once again exhibits unnecessary complexity, using many terms that are imprecise. For example, 'good faith' is an unclear way of setting standards of behaviour and propriety that should be required of clubs and their members. Another example is that members' guests may be supplied with alcohol on the premises in a variety of circumstances, but there is no clear statutory definition of the term 'guest'.''

Clause 63 deals with the establishment and conduct of a club in good faith, and I wonder whether the Minister seriously believes that the clause meets the laudable requirements set out in the White Paper, which states that such matters are difficult to define. One is left with the thought that the question may not have been addressed appropriately.

Chapter 10.8 of the guidance sets out the qualifying conditions of clauses 61 and 62 and goes on to say:

''Section 63 sets out additional qualifying conditions which apply solely to clubs intending to supply alcohol to members and guests. The full details in respect of these sections of the Act are reproduced in Annex [ ]''

The annex is still to be decided, so here we are, yet again, reaching a stage in the Bill where the accurate guidance that we ought to have in Committee to make sure that we are scrutinising this legislation at the most appropriate level is still not available. Perhaps the Minister could tell us why the guidance has taken so long and why, unless it has been supplied and we have not been sent a copy, the annexe to the guidance still states that the statutory qualifying conditions for clubs are to be agreed.

I should have thought that there had been sufficient time for those matters to have been sorted out between the various parties, and it would be helpful if the Minister were to tell us the stage that he has reached with the clubs in discussing the matters that relate specifically to clause 63.

Kim Howells (Labour, Pontypridd)

As we have just debated, whether a club is established and conducted in good faith is one of the general conditions that it must satisfy if it is to be a qualifying club in relation to any of the qualifying club activities. Clause 63 sets out the matters to be considered in determining that. Those matters include restrictions on a club's freedom to purchase alcohol, how money and property belonging to the club is used, giving members information about the club's finances, the accounts of the club and the nature of its premises. If a licensing authority determines that a club does not satisfy those conditions, it must notify the club accordingly to give the reasons for its decision.

Clause 63 replicates current licensing law in laying down rules and conditions for qualifying clubs. It is designed to prevent abuse of the special system that the Bill provides in recognition of the special status and contribution of the club movement, which we have been debating.

The annexes will set out the qualifying conditions in the Bill, but they cannot be completed until it completes its parliamentary procedures, which is why we have to use shorthand in the interim.

Question put and agreed to.

Clause 63 ordered to stand part of the Bill.

Clause 64 - The additional conditions for

Malcolm Moss (Conservative, North East Cambridgeshire)

I beg to move amendment No. 304, in

clause 64, page 37, line 13, leave out subsection (4).

Amendment No. 304 would take out subsection (4) and is a probing amendment. As it stands, subsection (4) would prevent any individual from deriving financial benefit from the supply of alcohol by or on behalf of club members or guests with the exceptions of

''any benefit accruing to the club as a whole, or any benefit which a person derives indirectly by reason of the supply giving rise or contributing to a general gain from the carrying on of the club.''

Exactly what or who is that designed to protect? In an earlier answer to my hon. Friend the Member for Fareham, the Minister said that there might be individuals out there who could profit by supplying a club. If a club committee deemed that it was getting a good deal in its own right that benefited its members, it is unreasonable and unnecessary that under this legislation the individual or individuals who might be supplying the club should not be able to do so. The onus is on the club and the club's committee to ensure that it runs a proper and efficient club for its members. As we know from annual general meetings, if committee members have not pulled their weight and done their work, those who will happily take on that mantle replace them. It should be entirely up to the club to decide whether any individual or group should benefit from supplying alcohol.

Many clubs have a bar steward who lives on and looks after the premises. They receive payment and may be said to profit from the sale of alcohol. In many cases, there may be a link between the profits of the club and the remuneration of that individual. Does that fall foul of clause 64(4)? Are such arrangements illegal, or will they be illegal under the Bill? Answers to those questions would be helpful.

Kim Howells (Labour, Pontypridd)

Clause 64 sets out the additional conditions that a qualifying club must satisfy for the supply of alcohol. Additional condition 3, which is set out in subsection (4), is that

''no arrangements are, or are intended to be, made for any person directly or indirectly to derive any pecuniary benefit from the supply of alcohol by or on behalf of the club to members or guests, apart from—

(a) any benefit accruing to the club as a whole, or

(b) any benefit which a person derives indirectly by reason of the supply giving rise or contributing to a general gain from the carrying on of the club.''

Amendment No. 304 would undermine completely the basis for distinguishing between the use of licensed premises and qualifying club premises. A key reason for preserving the special position of the club movement is the way alcohol is supplied to members of clubs. The critical point is that they club together to purchase the stock. They do not purchase alcohol from the club—as members, they already own it—but it is supplied to them by or on behalf of the club. It is true that money changes hands, but that is to ensure equity among members in the distribution of the alcohol that has been purchased for club use. I shall give an example to make that clear. The procedures are designed to be fair to Joe, who drinks six pints a week, and Harry, who drinks 10. Obviously, they are both moderate drinkers. No profit is made by anyone involved in the supply.

Amendment No. 304 would allow a profit to be made and would render a qualifying club indistinguishable from a commercial entity applying for a licence in respect of any premises such as, for example, a pub or a nightclub. It would remove entirely the justification for special treatment under the Bill. It would allow anyone to set up as a proprietary club and to benefit from the lighter controls that apply to qualifying not-for-profit clubs, from which they benefit as a result of their special nature. The amendment would allow clubs to sell alcohol without a personal licence holder or designated premises supervisor. They would be in direct competition with pubs and other licensed premises, from which they would be more or less indistinguishable.

The condition that prevents an individual from making a profit from the supply of alcohol is a key safeguard for local residents, protects the industry from unfair competition and, critically, provides a basis for the preservation and continuation of the special status of not-for-profit qualifying clubs. On that basis, I hope that the hon. Gentleman will withdraw the amendment.

Andrew Turner (Conservative, Isle of Wight)

I am concerned by the Minister's response to the comments of my hon. Friend the Member for North-East Cambridgeshire. If I give an illustration, perhaps the Minister will tell me whether I again have the wrong end of the stick.

A club has a steward and its members own the alcohol. The steward enjoys a bonus, depending on lettings of club premises, some of which may be for dominoes matches or private dinners. [Interruption.] I was not going to suggest such an activity. At some of those gatherings, alcohol may be served. Is that ruled out by subsection (4)?

Additionally, there may be an arrangement whereby even without any such lettings—where only members are concerned—the steward gains pecuniary advantage depending on the volume of alcohol sold. Most clubs recognise that one of the ways they can build up their facilities and improve the service that they offer to members is to make a profit from the sale of alcohol. Perhaps it was even the profit from the sale of alcohol that enabled the Conservative club to which

the Minister referred to furnish the use of snooker facilities for those who may not even have been Conservatives. It is reasonable to reward a steward for that sort of benefit, which derives from increasing the volume of sales, but that appears to be ruled out under subsection (4). Have I got that wrong?

Kim Howells (Labour, Pontypridd)

I fear that the hon. Gentleman has got it wrong.

I meant to answer the questions of the hon. Member for North-East Cambridgeshire about bar stewards, who profit from their labour via their employment by the club and not from the supply of alcohol per se. The club may enter into some arrangement with the steward about bonuses, but that is not what is being dealt with. The Bill does not prevent a club from employing a bar steward and the contracts between clubs and bar stewards are many and various. There was a time—I am sure that this is no longer the case—when the great problem with bar stewards was making sure that they did not run off in January with the takings and the barmaid. We lost quite a few in south Wales at one time—not, as far as I can remember, from the Con. club in Hirwaun—I cannot remember whether it was the Constitutional club or the Conservative club and I do not want to get the title wrong.

Andrew Turner (Conservative, Isle of Wight)

Does the Minister accept that Constitutional club is a term that is often used by Conservative clubs that may wish, for reasons best known to those in the locality, to conceal their exact political affiliation?

Kim Howells (Labour, Pontypridd)

In the case of Hirwaun, it was a thin disguise.

Mark Hoban (Conservative, Fareham)

I am sorry to prolong procedures. I want to return to one of the benefits of joining a club: getting some mutual benefit from membership. Someone might identify a person who could acquire on their behalf beer at a cheaper price—many people join clubs for cheaper beer as well for fellowship and comradeship—and the club committee might decide to split the saving between the person who found the source of cheaper alcohol and the club members. That would be precluded under the Bill.

On the comment made by my hon. Friend the Member for Isle of Wight (Mr. Turner) about relationships between the steward and the club and its members, the explanatory notes state:

''nobody should receive at the expense of the club a commission or percentage deriving from purchase of alcohol''.

A steward might increase alcohol sales and be rewarded on a commission basis for that increase. Based on the explanatory notes, it appears that that sort of arrangement, as opposed to a pure bonus arrangement, would be outlawed by subsection (4). My hon. Friend's amendment would resolve two or three of the problems associated with the way in which subsection (4) could operate in practice. It would simply eliminate the subsection. Furthermore, if it were demonstrated that a club was being conducted, and had been established in the first place in good faith, why would the additional condition be needed?

Clearly, the club would have demonstrated to the licensing authority that it was well run, for the benefit of members and not the committee or others.

Kim Howells (Labour, Pontypridd)

I have nothing to add beyond the explanation that I gave and clearly I did not convince the hon. Gentleman.

I could add a little extra in response to the hon. Member for Isle of Wight, who talked about the letting out of club premises. If a club hired out its premises for licensable activities other than qualifying club activities—the hon. Gentleman listed some possible ones—a premises licence would be required, which is different from the qualifying club permission. Use of premises under the authority of the premises licence does not carry a condition relating to profit, so the situation would be different.

Malcolm Moss (Conservative, North East Cambridgeshire)

I am still not convinced by the Minister's argument. He said that it was all right to pay stewards a bonus. He did not rule out whether that bonus was tied—as my hon. Friend the Member for Fareham implied—to the volume of alcohol supplied because technically it is not sold in a club but supplied across the counter. The more that is supplied, the more there is a margin of profit for the club that it could reinvest in its premises: its pool tables and so on. Most clubs need good alcohol sales to render their clubs successful and make them dynamic entities. It is their main source of income.

The Minister has not ruled out any correlation between a steward's bonus and the volume of alcohol sales that may go through that club in any given year. Re-reading subsection (3), the key words seem to be the last three at the end: ''by the club''. It refers to purchases of alcohol by the club, not in the club or by club members. There is a Chinese wall between the club on one side and whatever takes place within those walls, and what happens outside in the commercial sense that alcohol is purchased by the club in the first place. The clause says that no person may benefit and I do not understand that.

Kim Howells (Labour, Pontypridd)

The matter centres on the business of the steward and his relationship with the club. If the individual involved is a member of a club, he or she could not profit from the supply of alcohol in the way that the hon. Gentleman suggests. The savings could be put back into the club as a whole, but that is different.

Malcolm Moss (Conservative, North East Cambridgeshire)

Yes, that is different. I see that the Minister has some more information that may be the answer to the second question that I put to him, relating to the words ''by the club'', the Chinese wall, and the movement of the purchase of alcohol by the club from an individual. The clause seems to be saying that if the individual supplying the alcohol outside the club happens to be a member that cannot take place because the alcohol has been purchased by the club not within it.

Kim Howells (Labour, Pontypridd)

The committee that runs the club will have a policy about the purchase of alcohol. The bar steward is an employee and he or she is not in a position to influence club policy on the supply of

alcohol. A member can seek election to the committee and if that person made some private profit out of such action that would constitute the difference to which I alluded. That is what the hon. Gentleman seems to misunderstand. The steward can be an employee and may be a member of the club. If he is a member of the club, that would cast a different light on the issue.

Malcolm Moss (Conservative, North East Cambridgeshire)

I am grateful to the Minister for making another attempt to clarify the question. I am not convinced that even now I understand exactly what he is getting at, but that might be due to the time of day and my own difficulties. We may return to the matter at a later stage, but in the mean time, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Malcolm Moss (Conservative, North East Cambridgeshire)

I beg to move amendment No. 206, in

clause 64, page 37, line 20, at end insert—

'(5) For the purposes of subsection (2) a committee shall be deemed to be elected by members of the club if it is a subcommittee appointed by and from the club's main committee without any co-opted members, provided that a person who is co-opted to fill a casual vacancy as a substitute in place of an elected member (or in place of any such substitute) for the remainder of the term of that elected member, and no longer, shall be deemed to be elected.'.{**w43**}

The amendment is lengthy. It would clear up an implication in the clause that it may be necessary directly to elect a committee to deal with the supply of alcohol for club premises. That is not consistent with usual practice whereby one primary committee is directly elected, often at an annual general meeting, and the powers are delegated to a group or sub-committee dealing with alcohol matters. It is not usually the case that more than one committee need be directly elected by the club or society's membership. Not only does that defy the Government's assertions that the Bill provides flexibility and accountability for the bodies concerned, it would also require much amending and changing of club constitutions throughout the country. It would be interesting to know whether the Minister has had representations from clubs on the implications of the relevant subsection of the clause.

Our amendment would uphold the provisions established under schedule 7 of the 1964 Act and would prevent additional complication for club members. It would also maintain the provision that members of any sub-committee are subject to the age restriction of 18 years of age.

Kim Howells (Labour, Pontypridd)

The clause provides that additional conditions to those set out in clause 62 must be satisfied if the club is to supply alcohol to its members or their guests. The first condition in subsection (2) is that

''the purchase of alcohol for the club, and the supply of alcohol by the club, are managed by a committee whose members . . . are members of the club'',

are at least 18 years old and

''are elected by the members of the club.''

Amendment No. 206 would provide that under subsection (2) a committee would be deemed to be elected by club members if it were a sub-committee appointed by and from the club's main committee without any co-opted members. A person co-opted to

fill a casual vacancy as a substitute in place of an elected member, or in place of any such substitute, for the remainder of the term of the elected member and no longer would be deemed elected. The amendment would allow non-elected members to be part of the committee managing the purchase and supply of alcohol.

The amendment is unnecessary. Nothing in the Bill would prevent the committee responsible for managing the purchase and supply of alcohol from delegating its work to sub-committees or non-elected members, depending on anything in the rules of the club that might control such delegation and provided that the elected committee was still managing the purchase and supply of alcohol. The important principle that must be maintained is that the committee, which is elected by members, has ultimate responsibility for such issues.

If the amendment is an honest attempt to allow for sensible working practices in clubs, I can assure the Committee that it is not needed. If it is an attempt to allow the elected committee to offload its responsibilities on unelected members, it is unacceptable. Either way, I ask the hon. Gentleman to withdraw the amendment.

Malcolm Moss (Conservative, North East Cambridgeshire)

Amendment No. 206 adds constructively to the Bill. It clearly sets out the options available to the club committee on dealing with the requirements in the clause. I see no reason why that should complicate the situation; in fact, it clarifies it and I am surprised that the Minister does not see fit to take it on board. It is meant to be constructive. It enables clubs to set up sub-committees and to co-opt people on to them in an appropriate way, so that there is always a body that is deemed to be responsible for the provision or supply of alcohol by the club.

We are not in any way affecting the requirements of subsection (2) that the committee's members,

''(a) are members of the club;

(b) have attained the age of 18 years; and

(c) are elected by the members of the club.''

I see no reason why the amendment should be rejected because it clarifies what could be achieved. Unless the Minister can give me some more assurances, I will press the amendment to a Division.

Question put, That the amendment be made:—

The Committee divided: Ayes 4, Noes 8.

Clause 65 - Industrial and provident societies, friendly societies etc.

Mark Hoban (Conservative, Fareham)

I was surprised to find that clause 65 forms part of this Bill because my perception of industrial and provident societies and friendly societies was that they tend to be savings entities or other societies that are set up for the mutual financial benefit of their members. I think that I am right in saying that certain health insurers are set up as friendly societies and that friendly societies have particular tax benefits that arise based on the savings vehicles that they operate, which offer a good product for people on low incomes. Having understood that that was the background of those societies, it came as a surprise to me to see provisions in the Bill to cover the operation by them of clubs in the sense that we discussed with regard to earlier sections of the Bill.

I wish to understand why these organisations are allowed to operate such clubs. Is there not a risk that by operating clubs they might start to become more commercial ventures than they are at present? BUPA is a provident society: would we find it acceptable if it operated a club on the premises of one of its hospitals or nursing homes? Is that really what we are allowing them to do under this part of the Bill? I would be grateful if the Minister would give some clarification about the extent to which this clause is likely to be used by existing clubs or societies.

Kim Howells (Labour, Pontypridd)

I missed that adjective.

Mark Hoban (Conservative, Fareham)

I am unsure which adjective the Minister missed. I wish him to say how many existing clubs would use these provisions because it seems strange that they are included in the Bill, and to comment on how different the controls would need to be over those activities for them to be satisfactory in the context of a licensing authority looking at the operation of such entities.

Are we opening the floodgates? Many offices have been set up for, for example, the Ancient Order of Foresters Friendly Society, which used to be an industrial provident society, or for the Oddfellows or the Buffaloes—for a whole host of those little societies with offices up and down the country in small towns. Were they properly to constitute themselves, each could now open up a club. Their members might welcome that—I do not know. That might attract more members. The societies might see it as a valuable way of extending the services that they offer to their communities if they could open up qualifying clubs and sell low-cost financial services products at the same time. That might cause a change in the way in which such services are sold that would excite the Chancellor and the Financial Services Authority.

It is an odd situation if financial institutions there to help the low-paid can also operate clubs that will relieve them of their savings premiums, which will be spent on beer instead. Perhaps the Minister can take the opportunity to clarify why this measure has been included and whether it will be used in practice.

Malcolm Moss (Conservative, North East Cambridgeshire)

As I understand it, clause 65 is lifted, perhaps verbatim, from the Licensing Act 1964. Perhaps the Minister can confirm whether it is the same, word for word. I suspect that clause 66 is of much the same ilk. Most clubs that come under this part of the Bill are non-profit-making clubs, which is why they enjoy such benefits, but why do some—those identified in clause 65—apparently not have to fulfil the requirements placed on other non-profit-making clubs? Is there something special about them? They are, in some cases, charitable institutions and registered under various other Acts of Parliament. Does that confer upon them the ability to run a club that involves the sale of alcohol and provision of entertainment better or more wisely than any other group of people who come together to form a non-profit-making club? It seems that, because the measure was in earlier legislation and there was no input from anyone to say that it was working badly or inappropriately or was conferring special privileges, the Government just decided to lob it in here. That is not a real justification for keeping it.

Kim Howells (Labour, Pontypridd)

May I help the hon. Gentleman and save him a little time? Are he and his hon. Friends saying that we should prevent industrial and provident societies and friendly societies from setting themselves up as clubs that can sell alcohol if they so choose, as they do now?

Malcolm Moss (Conservative, North East Cambridgeshire)

No, I am not saying that at all. If I am going down the wrong road, the Minister will no doubt bring me back into line, but my interpretation is that if such societies choose to set up clubs, they will not necessarily have to abide by all the regulations and requirements placed on other non-profit-making clubs. That enables them to duck some of the requirements and responsibilities set down in the legislation for other non-profit-making clubs. If I am wrong in that interpretation, I should be more than grateful if the Minister put me right.

Andrew Turner (Conservative, Isle of Wight)

My hon. Friends have put their finger on an important point. Why is that particular category of club specified in the Bill at all? The Minister, intervening on my hon. Friend the Member for North-East Cambridgeshire, suggested that if we removed the clause we would be preventing those societies from running clubs. I see no such possibility. The Bill permits both incorporated and unincorporated associations, formed for whatever purpose, to apply for club certificates. The removal of clause 65 would not prevent the people who form those societies and who are members of them from forming a club on club premises in exactly the same way as, for example, Shanklin Conservative club.

My hon. Friend asked whether there are exemptions accruing to organisations covered by clause 65 from the generality of the conditions set out in clauses 62, 63 and 64. If there are no such exemptions, I see no need for that particular clause.

I should like to ask the Minister why, if there is no difference in the conditions, he has not felt it necessary to refer in the Bill to, for example, student unions. Perhaps student unions are not voluntary

organisations but they are organisations in which people can come together. In many cases they provide cheap beer and snooker, and sometimes even barmaids; they provide exactly the same opportunities as the Con club to which the Minister referred. Why is it that industrial and provident societies are referred to in the Bill and student unions are not?

Kim Howells (Labour, Pontypridd)

I will be brief because we have had a comprehensive debate. [Hon. Members: ''No.''] We certainly have, considering what we have been debating. The clause provides for registered industrial and provident societies and registered and incorporated friendly societies to be treated for the purpose of the Bill as satisfying some of the conditions of being a qualifying club, provided that certain requirements relating to their constitution and management are met. The clause makes it possible for such organisations to apply for a club premises certificate. There are 22,000 registered members clubs under the Licensing Act 1964. Friendly societies and others have been included at the behest of the Committee of Registered Clubs Association, of which the Conservative club movement is a leading member.

Malcolm Moss (Conservative, North East Cambridgeshire)

The Minister wants to move us on very quickly without answering some of the questions, and I am puzzled as to why. Subsection (5) makes it clear that a club that comes out of an incorporated friendly society automatically fulfils condition 3 in clause 62(4), condition 5 in clause 62(6) and the additional conditions in clause 64. No other club would appear to have those advantages, and it is down to the Minister to explain why friendly societies and those registered in various ways have that particular dispensation. I do not understand why and I should like the Minister to explain.

Mark Hoban (Conservative, Fareham)

While the Minister consults the hon. Member for Battersea (Martin Linton), perhaps he will enlighten the Committee on how many of those 22,000 licensed clubs registered under the 1964 Act are industrial and provident societies and friendly societies. Would he be happy if some of the large friendly societies, which are large commercial operations, were to open a chain of clubs across the country to meet their members' needs? Further to that, will he define who the secretary of one of those organisations would be? The secretary crops up as an important person in, for example, supplying licensing authorities with notices.

Question put and agreed to.

Clause 65 ordered to stand part of the Bill.

Clause 66 - Miners' welfare institutes

Mark Hoban (Conservative, Fareham)

I am uniquely qualified among those on this side of the Committee to raise the issue of miners' welfare institutes because I am probably the only hon. Member, at least among Conservatives, who is the son of a former miner.

I wonder whether the provision has just been lifted wholesale from the 1964 Act, without taking advantage of the opportunity to update some of the wording to reflect the current state of mining communities. It is interesting that subsection (5)(c)(i) refers to committees or boards consisting

''partly of persons employed, or formerly employed, in or about coal mines'',

whereas subsection (3) defines a miners' welfare institute as

''an association organised for the social well-being and recreation of persons employed in or about coal mines''.

That begs the question of why those who were formerly employed are on the committee, but I do not think that that line of questioning will be profitable or fruitful at this point.

I wonder why the Government did not take advantage of the legislation to broaden the definition of those who could be members of miners' welfare institutes by referring to those who were formerly employed, as well as those who are currently employed, thereby reflecting that in many coal-mining areas where such institutes are located there are few, if any, people who are employed in the mining industry.

Kim Howells (Labour, Pontypridd)

Clause 66 applies the arrangements for qualifying clubs to a relevant miners' welfare institute. While recognising certain differences, it allows the institute's premises and its enrolled membership to be treated as if it were a club like other working men's clubs. Furthermore, anything done by the institute's trustees or management is treated as if done on behalf of the club. That is in many ways a crucial difference.

The Bill adopts the position of the Licensing Act 1964 in order to preserve the valuable tradition whereby miners' welfare institutes are treated like other clubs operating under club committees. Such institutes are enormously well regarded in their communities and are organised for the social well-being and recreation of persons employed, or formerly employed, in or about coal mines. As the hon. Member for Fareham knows, very few miners' institutes had bars until relatively recently. They were often forced, mainly in the late 1960s and 1970s, to incorporate bars or to begin to run bars. The coal mine closures during that time meant that the subscriptions to the institutes that had come directly from miners' wages were no longer being paid. As a consequence, the institutes had to find a way to generate alternative revenue.

The Bill sets down unique qualifying conditions for institutes because of their special nature. Two thirds of the institute's board or committee must include persons appointed or nominated, or appointed or elected from among persons nominated by one or more licensed operators within the meaning of the Coal Industry Act 1994, and persons appointed or nominated, or appointed or elected from among persons nominated by one or more organisations representing persons employed in or about coal mines.

If special circumstances apply to a particular institute and that is not possible, an alternative

condition applies. The hon. Gentleman is right to raise the matter. The huge number of mine closures in the 1980s resulted in coal miners who were still quite young moving away from the villages during that shake-out and looking for jobs in other parts of the country. Under the alternative condition, at least two thirds of the committee or board must consist of persons employed or formerly employed in or about coal mines and persons appointed by the Coal Industry Social Welfare Organisation or a body or person to whom the functions of the organisation have been transferred. The range of people is not limited to those who may have worked in the mine or even around the mine. I hope that that deals with some of the hon. Gentleman's questions.

A final condition is that the premises of the institute are held in trusts to which section 2 of the Recreational Charities Act 1958 applies. Those technical provisions are important. As the hon. Gentleman implied, they have been taken from the previous legislation so that those important institutions are not excluded from the privileges afforded to similar working men's clubs and their premises certificates.

I make it clear that many miners' welfare institutes function very well as clubs, have a healthy turnover and are active in their communities. I do not want to suggest—I am sure that the hon. Gentleman does not want to—that the decline of the coal industry has resulted in all those clubs being on their knees, because that is not so. Indeed, the committees and trustees of clubs have shown tremendous imagination and managerial expertise, often in association with progressive breweries, in turning those institutions into properties with excellent amenities for their communities. We should pay tribute to that.

Andrew Turner (Conservative, Isle of Wight)

I was interested to hear the exchange between the Minister and my hon. Friend the Member for Fareham because an opportunity may be being missed to draw on the experience of miners' welfare institutes, the details of which I was unaware. In some communities, commercial organisations, businesses, engineering firms and others run similar clubs and organisations for their staff and sometimes for former staff. In my constituency, the GKN Westland club was an example but, sadly, it closed down recently. However, as I understand it, the principal distinction between the institutions referred to in clause 66 and those referred to in clauses 62 to 64 is their government the Minister will tell me if I am wrong—and the fact that they are managed in part by the employers and in part by the members, employees or people acting on their behalf. That does not seem to be a system that is unique to miners' welfare institutes.

Kim Howells (Labour, Pontypridd)

I appreciate the point that the hon. Gentleman is making and he is right because many other industries have their own version of miners' institutes, although elements of miners' institutes, because of the isolation of communities, are probably a little different. We are dealing not with

other sectors of industry, but with the transfer of legislation that worked well for miners' institutes into the new legislation. We are not missing an opportunity for other industries; the clause simply deals with miners' institutes.

Andrew Turner (Conservative, Isle of Wight)

I accept that and I do not intend to detain the Committee much longer. I am merely concerned that the omission of an equivalent clause covering such constitutional arrangements in other clubs, taken alongside clause 64(2), prevents other clubs with similar constitutional arrangements from enjoying the benefits of club certificates.

Kim Howells (Labour, Pontypridd)

I do not believe that we are doing that.

Question put and agreed to.

Clause 66 ordered to stand part of the Bill.

Clause 67 - Associate members and their guests

Malcolm Moss (Conservative, North East Cambridgeshire)

I beg to move amendment No. 205, in

clause 67, page 39, line 21, leave out from 'club' to end of line 22 and insert—

'(b) he has been a member of that other club for at least two days, and

(c) the club's committee or subcommittee responsible for the supply of alcohol is satisfied, on reasonable grounds, that the primary purpose of that other club is not the supply or purchase of alcohol.'.

To prove that a visiting member is a member of a recognised club is pretty difficult. By the Department's own admission, it would rely on the secretary of the other club, probably more than anyone else, confirming that the club was indeed recognised. That in turn would require the certification that the relevant wording in clause 62 was included in its constitution. Furthermore, as we have discussed, the requirement that the club is conducted in good faith as a club can be determined only by the licensing authority, having regard to the terms of arrangements for the purchase of alcohol, the use of club money, property or profits to the benefit of anyone except the club

''for charitable, benevolent or political purposes'',

the proper keeping of accounts and the provision of financial information to members, and, of course, the nature of the club premises. All those things will already have been taken into account when the licensing authority deems that the club is being conducted in good faith.

Surely it would be much simpler to invoke the standard safeguard of the two-day interval between application and membership, which our revised paragraph (b) provides?

Kevan Jones (Labour, North Durham)

Is it not the case that in the CIU movement, in Conservative associations, and certainly in Labour clubs, guests go from club to club and have cards to prove that they are members of the overall organisation? If there is any unruly conduct on the part of the individual, disciplinary action can be taken by the members of their own club. Therefore, by restricting access to members of the CIU, Conservative associations or Labour clubs, people can move from club to club.

Malcolm Moss (Conservative, North East Cambridgeshire)

I am not sure about that. I hear what the hon. Gentleman is saying. Such movement is perhaps facilitated by the arrangements that he mentioned, but we are attempting to make absolutely certain that the club at which visitors and guests are being entertained—if I may use that word—complies with the law set out in clause 67. Our suggested paragraph (c) would allow the host club more safely to admit a member of another club. The Bill would be clearer.

Nick Harvey (Liberal Democrat, North Devon)

The hon. Gentleman is wrong to propose the amendment. It would delay the access of members of other clubs to social clubs. From a constituency point of view, many of the clubs in seaside towns in North Devon offer their facilities to people who are visiting resorts and are members of clubs elsewhere. Some people come only for a long weekend or a few days and if they had to wait for the two days proposed in the hon. Gentleman's amendment, half their holiday would be gone. Clubs allow members of other clubs simply to show another club card, be it from the National Union of Liberal Clubs, the CIU, or, heaven forfend, even from Conservative or Labour clubs—such people are simply allowed to brandish their cards and come in. That approach is preferable to the delay that is inherently built into the hon. Gentleman's amendment.

Kim Howells (Labour, Pontypridd)

Clause 67 provides that references to guests of club members include associate members of the club and guests of associate members of the club and further provides that a person is an associate member of the club, for the purposes of the Bill, if,

''in accordance with the rules of the club, he is admitted to its premises as being a member of another club, and . . . that other club is a recognised club''.

A recognised club is one that satisfies the first three conditions set out in clause 62, as we have agreed.

Amendment No. 205 would change the definition of ''associate member'', requiring that to qualify as such, a person would have to have been a member of the other club for at least two days and that the committee or sub-committee responsible for the supply of alcohol was satisfied that the primary purpose of that other club was not the supply or purchase of alcohol. The amendment would therefore prevent any member of a club whose primary purpose was the sale of alcohol from being an associate member of another club.

I am afraid that I am at a loss to understand the amendment's intention. Let me say once again that the expanded definition of ''guest'' for the purposes of part 4 of the Bill is not a backdoor through which a club can supply alcohol to its members without the need for a club premises certificate or a premises licence. A recognised club is not a guest. Under existing law, members of clubs are able to use associated clubs. As we have heard, a member of a miners' welfare institute in Wales can use another miners' welfare institute when visiting England if the rules of that institute permit that admittance. That seems sensible. It reflects the community role of such clubs and the fact that, traditionally, clubs knit together nationally, not only at local level.

The point that the hon. Member for North Devon (Nick Harvey) made was important. I know for a fact that members of all manner of clubs, including railway clubs and many others, enjoy a pint when, for example, they visit a seaside resort by going into a club. Often, they feel that they are getting a better deal than they might get in another licensed premises, although that is not always the case. The amendment would prevent anyone who is a member of a club whose primary purpose is the sale of alcohol—which includes a great many registered clubs at present—from being treated as an associate member of another club. The Government do not agree that curtailment of the extent to which members of qualifying clubs can use the facilities of other, associated qualifying clubs is justified. Nor do they think it appropriate to prescribe the rules of a club in the Bill, except where that is necessary to impose a qualifying standard for clubs that wish to take advantage of its provisions. I can see no such necessity here. The scheme set out in the Bill reflects closely the position in existing legislation on clubs, which has operated well for a number of years. I therefore hope that the amendment will not be pressed.

Malcolm Moss (Conservative, North East Cambridgeshire)

I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 67 ordered to stand part of the Bill.

Clause 68 - The relevant licensing authority

Malcolm Moss (Conservative, North East Cambridgeshire)

I have a couple of questions for the Minister on clause 68. Is it a new provision, or does it relate to earlier legislation, in particular the 1964 Act? In how many instances do premises—in this case, club premises—straddle local authority areas? We dealt with that when we discussed pubs straddling licensing areas in various parts of the country, but we did not come to any agreement or discuss the scale of the incidence. It would be interesting to hear from the Minister why this provision has been included. Is it simply lifted from earlier legislation, or has there been a growing problem in the intervening years since 1964 where licensed premises such as clubs fall on the boundaries of relevant licensing authorities? Does the definition of ''premises'' refer to one particular building? Are we talking about adjoining buildings, a group of buildings or buildings that are separated geographically but in the same town or village? Why is the provision included and what is the scale of the problem?

Kim Howells (Labour, Pontypridd)

I can confirm that the provision is new. The clause provides the means of determining which is the relevant licensing authority for the purpose of part 4. It provides that the relevant licensing authority for these purposes is the authority in which the premises, or the greater part of the premises, is situated. It approaches the determination of the relevant licensing authority in the same way that the Bill approaches premises licences. I hope that that helps the hon. Gentleman.

Where club premises straddle two or more authority areas equally, there could be a problem. I cannot tell the hon. Gentleman how many of those there are, but they must be rare. I have been informed by geographers that boundaries mainly go down the middle of highways and that buildings are usually on either side of them and not in the middle. However, I have also been told that in some market towns there might be a club or pub in a building that was formally a market building and the new configured boundary could go straight through the middle of it. Can the hon. Member for Isle of Wight give us an example?

Andrew Turner (Conservative, Isle of Wight)

No, but to extend the argument of my hon. Friend the Member for North-East Cambridgeshire, it is conceivable that a large university in a conurbation such as London might have three or four premises, all of which together form the student union. I am not sure whether student unions are covered by the clause, but that is an example.

Kim Howells (Labour, Pontypridd)

The Committee should be grateful to the hon. Gentleman for coming up with that example. I, too, have found a couple of examples. There are very few premises that straddle boundaries, but Earls Court is one. There are also a few pubs on islands in rivers—boundaries often follow the course of rivers. The Bill is merely anticipating a problem and offering a solution. We do not know of any clubs that are so situated, but I am sure that we can dig some up before the end of proceedings.

Malcolm Moss (Conservative, North East Cambridgeshire)

The Minister suggests that there are not many incidences of the problem. Why, then, has his Department seen fit to introduce a new clause for a situation that is hardly worth mentioning?

Kim Howells (Labour, Pontypridd)

It does happen occasionally, and, with great respect to the hon. Member for North Devon, the last thing that I want is to give food to lawyers. The clause provides an important mechanism for the resulting uncertainty, and will benefit clubs and local authorities alike.

Question put and agreed to.

Clause 68 ordered to stand part of the Bill.

Clause 69 - Authorised persons, interested parties

Clause 70 - Other definitions relating to clubs

Mark Hoban (Conservative, Fareham)

May I ask the Minister about the definition of the word ''secretary''? I am not entirely clear why someone who is not an officer of the club should be able to act as a secretary. Surely, someone acting as a secretary should be recognised by club members as holding particular authority. If anybody in a club were allowed to be, or could claim to be, designated secretary, that role would be diminished. It would be better for there to be a designated secretary who was part of the club committee or, in the absence of a designated secretary, for another club member, such as the chairman, treasurer, or vice-chairman, to act as the designated person for the purposes of the Bill.

Mark Field (Conservative, Cities of London and Westminster)

My hon. Friend has hit the nail on the head. There should be a single designated person. There is a risk that for the purposes of the clause, three or four people could purport to be the secretary.

Mark Hoban (Conservative, Fareham)

I am grateful to my hon. Friend for adding weight to what I said, as a lawyer—

Mark Field (Conservative, Cities of London and Westminster)

A former lawyer.

Mark Hoban (Conservative, Fareham)

My hon. Friend says that he is a former lawyer.

Mark Field (Conservative, Cities of London and Westminster)

A long time ago.

Mark Hoban (Conservative, Fareham)

A secretary of a company is a designated person with real standing and status who is appointed at the annual general meeting. However, under the Bill the person designated as secretary could be a typist who comes in one morning a week to type letters for the club chairman. If we are to give powers to someone who is meant to represent the club to the licensing authority, the club should ensure that that person has genuine status and is a genuine officer of the club, not just a typist, whether or not they are defined as a secretary.

The rest of the debate is in Hansard.